Auditing & Assurance Services 6th Edition by Timothy Louwers

Exercise 436

An audit team designed a sample that would provide a 10 percent risk of overreliance that not more than 7 percent of sales invoices lacked credit approval. From previous audits, the audit team expected that 3 percent of the sample invoices lacked proper approval. From the sample of 90 invoices, 7 were found to lack credit approval. Using AICPA sample evaluation tables, the audit team determined that the upper limit rate of deviation was
A) 3.3%.
B) 4.5%.
C) 7.8%.
D) 12.8%.