The 'Expected Error' in audit sampling is: MCQ with Answer and Explanation

Question
The 'Expected Error' in audit sampling is:
A. Error in the sample only
B. The maximum acceptable error
C. The error the auditor expects to find in the population
D. Actual error after testing
Answer: Option C
Solution (By JKSSB Mock Tests)
Expected error is estimated before testing; it affects sample size.
This question belongs to: Accountancy and Statistics Accountancy and Book Keeping
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Question #1
The 'Accrual Concept' is also known as:
A. Hybrid system
B. Cash system
C. Single entry
D. Mercantile system
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Correct Answer: Option D

Explanation:
Accrual basis is also called mercantile basis, where transactions are recorded when they occur, not when cash is paid/received.
This question belongs to: Accountancy and Statistics Accountancy and Book Keeping
Question #2
The 'Discount Rate' for measuring defined benefit obligation under Ind AS 19 is determined by reference to:
A. Market yields on government bonds at the reporting date
B. Expected return on plan assets
C. Incremental borrowing rate
D. Fixed rate
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Correct Answer: Option A

Explanation:
The discount rate reflects the time value of money; usually based on high-quality corporate bonds or government bonds.
This question belongs to: Accountancy and Statistics Accountancy and Book Keeping
Question #3
Which of the following is not a purpose of financial audit?
A. Detecting fraud and error
B. Preparing financial statements
C. Expressing opinion on true and fair view
D. Ensuring compliance with laws
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Correct Answer: Option B

Explanation:
Preparation of financial statements is management's responsibility. Auditor expresses opinion on them.
This question belongs to: Accountancy and Statistics Accountancy and Book Keeping
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