Question: Explain the difference between known and likely misstatements. Assume the auditor tests a sample of $ 1 0 0 , 0 0 0 of inventory

Explain the difference between known and likely
misstatements. Assume the auditor tests a sample of
$100,000 of inventory and finds misstatements totaling
$5,000.
What is the likely misstatement if the account balance
is $500,000?

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