To determine whether the account balance or class of transactions is materially misstated,the auditor
A)determines the tolerable misstatement from the sample results and compares this amount to the projected misstatement allocated to the account balance or class of transactions
B)determines the projected misstatement from the sample results and compares this amount to the tolerable misstatement allocated to the account balance or class of transactions
C)determines the expected deviations from the sample results and compares this amount to the tolerable misstatement allocated to the account balance or class of transactions
D)determines the actual deviations from the sample results and compares this amount to the tolerable misstatement allocated to the account balance or class of transactions

Question

Quizplus · Accepted Answer

The correct approach involves determining the projected misstatement from the sample results and then comparing this amount to the tolerable misstatement that has been allocated to the account balance or class of transactions. This process helps in assessing whether the account or transactions are materially misstated.

To Determine Whether the Account Balance or Class of Transactions