Indicate whether each of the following represents an application of a statistical (S)or nonstatistical (N)sampling application.
1____.In order to begin testing the occurrence assertion for Bear's sales invoices,Lion determined the expected population deviation rate to be 1.25%,the tolerable rate of deviation to be 4% and the risk of overreliance to be 5%.
2____.Lion determined the tolerable rate of deviation to be low while testing controls concerning loan agreements.The audit team considered the sample size provided by the AICPA tables but decided that more loans needed to be tested to accurately evaluate the population.
3____.To test the accuracy of Bear's accounts receivable,Lion ordered the accounts into an aging list and selected the last fifty items for examination.
4____.A list of pre-numbered purchase orders was used to test the completeness assertion.Lion decided to randomly select items from the list for examination by identifying them from a perusal of files.
5____.Lion suspected the existence of fraud in Bear's payroll department.As a result,Lion set the expected population deviation rate at zero and used quantitative measures to ensure that sampling risk was controlled to acceptable levels.
6____.Lion used professional judgment to estimate the allowance for sampling risk to determine the likely rate of deviation in the population when testing the cutoff of Bear's sales invoices.
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