The Major Reason That the Difference and Ratio Estimation Methods

Multiple Choice

The major reason that the difference and ratio estimation methods would be expected to produce audit efficiency is that the:

A) beta risk may be completely ignored.
B) variability of the populations of differences or ratios is less than that of the populations of book values or audited values.
C) number of members of the populations of differences or ratios is smaller than the number of members of the population of book values.
D) calculations required in using difference or ratio estimation are less arduous and fewer than those required when using direct estimation.