In a probability-proportional-to-size sample with a sampling interval of $10,000,an auditor discovered that as selected account receivable with a recorded amount of $12,000 had an audited amount of $9,000.If this were the only misstatement discovered by the auditor,the projected misstatement of this sample would be:
A)$2,000.
B)$2,500.
C)$3,000.
D)$10,000.

Question

Quizplus · Accepted Answer

To calculate the projected misstatement, the auditor needs to use the formula:

Projected misstatement = (misstated item / recorded amount) x sampling interval

In this case, the misstated item is $3,000 ($12,000 - $9,000). Therefore, the projected misstatement is:

Projected misstatement = ($3,000 / $12,000) x $10,000 = $2,500

So, the best choice is B: $2,500.

In a Probability-Proportional-To-Size Sample with a Sampling Interval of $10,000,an