Auditing & Assurance Services 6th Edition by Timothy Louwers

Exercise 546

Sampling and Nonsampling Risk. Read the following five independent sampling applications.
Required:
Indicate whether each situation is characteristic of sampling risk (S) or nonsampling risk (N). Provide a brief explanation for your answer.
a. You are estimating the average net income of passengers on a particular airline flight. You randomly select three rows of seats (a total of 18 passengers) and calculate the average income of those passengers.
b. When estimating the average time for swimmers in a 25-meter freestyle race, you inadvertently include the times of swimmers from other events (butterfly, breaststroke, and backstroke) in your sample.
c. When estimating the average time necessary to finish an examination, the class of students you randomly selected was an honors section of the course.
d. When estimating the percentage of sixth-grade students who plan to attend college, your sample includes a disproportionate number of students attending intermediate schools located in small college towns (many of the parents are affiliated with the local university).
e. When estimating the total amount of money held in savings accounts by people of various nationalities, you make some inadvertent mistakes in converting various currencies into U.S. dollars.