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L11 Notes_Part_18 - d What sample size should be used for...

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Determine Sample Size
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Attribute Sample Problem a. The risk of assessing control risk too low is 5 percent. Determine the sample size for each of the following controls. Tolerable Expected Rate Rate Sample Control (Percent) (Percent) Size 1 5% 0% 2 5% 2% 3 10% 0% 4 5% .75% 5 10% 1% 1) 59, 2) 181, 3) 29, 4) 93, 5) 46 b. What is it that you are deciding whether to accept or reject when performing an attribute sample and for what reason? c. What is the general effect on sample size of using a 5 percent risk of assessing control risk too low rather than 10 percent? Explain.
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Unformatted text preview: d. What sample size should be used for control 1 if there were only 200 sales transactions? n = n’ /(1 + (n’/N)) 59/(1 + (59/200)) = 46 Attribute Sample Problem The risk of assessing control risk too low is 5 percent. Determine the Achieved Upper Limit assuming a sample size of 80. Tolerable Achieved Deviation Sample Number of Upper Control Rate Size Deviations Limit 1 5% 80 0 2 5% 80 4 3 10% 80 2 4 5% 80 1 1) 3.7 2) 11.1 3) 7.7 4) 5.8 e. Based on the achieved upper limits, on which of the controls can the auditor accept? Why?...
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