The 1,000 accounts receivable of Baker Company have a total book value of $30,000 (Average book value = $30).Wendy Duffo,CPA,has selected and audited a sample of 50 accounts with the following mean values:
1.Book value of $29.00
2.Audited value of $29.50.
-What is the estimated total audited value using difference estimation sampling?
A)$29,000.
B)$29,500.
C)$30,517.
D)$30,500.

Question

Quizplus · Accepted Answer

The estimated total audited value using difference estimation sampling can be calculated as follows: Total book value + [(Mean audited value - Mean book value) x Number of items in population] = $30,000 + [($29.50 - $29.00) x 1,000] = $30,000 + $500 = $30,500.

The 1,000 Accounts Receivable of Baker Company Have a Total