An account balance is $300 000 and there are 80 items in the account, six of which have balances that equal or exceed $15 000. The auditor plans to use a dollar-unit sampling plan with systematic sample selection. To ensure that all accounts with balances of at least $15 000 are selected, the sampling interval should be:
A) 80.
B) 6.
C) 15 000.
D) 12 000.

Question

Quizplus · Accepted Answer

To ensure that all accounts with balances of at least $15,000 are selected, we need to set the interval equal to this amount. 
Sampling interval = Total account balance / Number of sampling units = $300,000 / 80 = $3,750 
If we use an interval of $3,750, then every account with a balance of $15,000 or more will be selected (since $15,000 / $3,750 = 4, which means that every fourth account will be selected). 
Therefore, the best choice is C – 15,000.

An Account Balance Is $300 000 and There Are 80