How does the auditor establish the level of tolerable misstatement in a variables sampling application?

Multiple Choice

based on the anticipated cost of conducting additional substantive procedures

based on the findings in prior audts or based on a small sample taken during the current year

based on the recorded amount of the account balance as well as the relationship of the account balance with subtotals

based on prior assessments of audt risk, risk of material misstatement, and analytical procedures risk