In the audit of potomac mills the auditors wish to test the

Reference no: EM13594438

In the audit of Potomac Mills, the auditors wish to test the costs assigned to manufactured goods. During the year, the company has produced 2,000 production lots with a total recorded cost of $5.9 million. The auditors select a sample of 200 production lots with an aggregate book value of $600,000 and vouch the assigned costs to the supporting documentation. Their audit discloses misstatements in the cost of 52 of the 200 production lots; after adjustment for these misstatements, the audited value of the sample is $582,000.

Required: Show how the auditors would compute an estimate of the total cost of production lots manufactured during the year using each of the following sampling plans.

Reference no: EM13594438

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