The auditor has decided to use systematic selection of cash payments when testing the control that cheque payments are supported by a supplier's invoice, a purchase requisition and a goods received note. Each cheque comprises a sampling unit. There are 5000 cheques drawn (numbered 1-5000) and the total amount of cash payments is $10 million. The sample size is 20 and the random start is 127. Given this information, the sample interval is:
A) 500 000.
B) 250.
C) 127.
D) Some other amount.

Question

Quizplus · Accepted Answer

The sample interval can be calculated by dividing the population size by the sample size. In this case, the population is the number of cheques (5000) and the sample size is 20. Therefore, the sample interval is:

Population size / Sample size = 5000 / 20 = 250

So the correct choice is B).

The Auditor Has Decided to Use Systematic Selection of Cash