Part A

Below are the initial 20 items from the population of inventory items for Saturn Ltd:

Population item	Amount ($)		Population item	Amount ($)
1	1,890		11	425
2	6,250		12	11,895
3	825		13	3,270
4	22,110		14	1,150
5	16,225		15	975
6	1,000		16	910
7	770		17	2,465
8	5,725		18	4,220
9	9,130		19	735
10	7,755		20	1,760

The total of the inventory account is $2,000,000, consisting of 500 items.

A sample of 100 items is to be selected with a random start of 4.

The tolerable error is set at $100,000.

Required:

(a) Using traditional systematic sampling, which inventory items will be the first 3 included in the sample? Show all calculations. (2 marks)

(b) Using Dollar Unit Sampling (DUS) with selection by a systematic sampling technique, which inventory items will be the first 3 included in the sample? Show all calculations (3 marks)

(c) If the total amount for the samples is $1,700,000 and the misstatement found in the samples is $80,000, explain whether the inventory balance is materially misstated. Show all calculations. (2 marks)

(d) What possible courses of action can you take for your results in part (c)? (2 marks)

Part B

Recent technological developments have significantly influenced the auditors approach to sampling.

Discuss this statement. (Maximum 150 words) (5 marks)