The Multiple Choice Questions Blog

For the following statement below, select whether it is of no relevance, depending on the size of the client, true or false in respect of the procedures to obtain evidence.

• Inquiry is always an unreliable means of obtaining evidence.

Select ONE answer:

1. Of no relevance
2. True
3. Depending on the size of the client
4. False

Show your workings to arrive at your answer, and explain and justify your reasons:

……………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………

This multiple-choice question is suitable for Accounting KS5 classes.

The answer is 4

1. Not correct
2. Not correct
3. Not correct
4. Correct – Physical examination of property, plant and equipment confirms its existence, which may belong to a third party. The reliability of the inquiry depends on who is providing the information. A third party, e.g., a bank, would normally be a reliable source.

This work is licensed under a Creative Commons Attribution 4.0 International License.

For the following statement below, select whether it is of no relevance, depending on the size of the client, true or false in respect of the procedures to obtain evidence.

• Recalculation is a strong form of evidence as it is created by the assurance provider.

Select ONE answer:

1. False
2. Of no relevance
3. True
4. Depending on the size of the client

Show your workings to arrive at your answer, and explain and justify your reasons:

……………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………

This multiple-choice question is suitable for Accounting KS5 classes.

The answer is 3

1. Not correct
2. Not correct
3. Correct – Physical examination of property, plant and equipment confirms its existence, which may belong to a third party. The reliability of the inquiry depends on who is providing the information. A third party, e.g., a bank, would normally be a reliable source.
4. Not correct

This work is licensed under a Creative Commons Attribution 4.0 International License.

For the following statement below, select whether it is of no relevance, depending on the size of the client, true or false in respect of the procedures to obtain evidence.

• Physical examination of property, plant and equipment confirms ownership.

Select ONE answer:

1. True
2. False
3. Of no relevance
4. Depending on the size of the client

Show your workings to arrive at your answer, and explain and justify your reasons:

……………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………

This multiple-choice question is suitable for Accounting KS5 classes.

The answer is 2

1. Not correct
2. Correct – Physical examination of property, plant and equipment confirms its existence, which may belong to a third party. The reliability of the inquiry depends on who is providing the information. A third party, e.g., a bank, would normally be a reliable source.
3. Not correct
4. Not correct

This work is licensed under a Creative Commons Attribution 4.0 International License.

Which ONE of the following statements are correct regarding factors which influence sample sizes for tests of controls?

Select ONE answer:

1. An increase in the extent to which the risk of material misstatement is reduced by the operating effectiveness of controls will decrease the sample size
2. An increase in the number of sampling units within the population will increase the sample size
3. A decrease in the tolerable misstatement will decrease the sample size
4. An increase in the expected misstatement will decrease the sample size

Show your workings to arrive at your answer, and explain and justify your reasons:

……………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………

This multiple-choice question is suitable for Accounting KS5 classes.

The answer is 1

1. Correct – ISA 530 states factors influencing sample sizes for tests of controls include: An increase in the number of sampling units will have a negligible effect on the sample + A decrease in the tolerable misstatement will decrease sample size.
2. Not correct
3. Not correct
4. Not correct

This work is licensed under a Creative Commons Attribution 4.0 International License.

Which ONE of the following statements are correct regarding factors which influence sample sizes for tests of controls?

Select ONE answer:

1. An increase in the number of sampling units within the population will increase the sample size
2. A decrease in the tolerable misstatement will decrease the sample size
3. An increase in the extent to which the risk of material misstatement is reduced by the operating effectiveness of controls will NOT decrease the sample size
4. A decrease in the expected misstatement will decrease the sample size

Show your workings to arrive at your answer, and explain and justify your reasons:

……………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………

This multiple-choice question is suitable for Accounting KS5 classes.

The answer is 4

1. Not correct
2. Not correct
3. Not correct
4. Correct – ISA 530 states factors influencing sample sizes for tests of controls include: An increase in the number of sampling units will have a negligible effect on the sample + A decrease in the tolerable misstatement will decrease sample size.

This work is licensed under a Creative Commons Attribution 4.0 International License.