A suburban hotel derives its revenue from its hotel and restaurant operations. The owners are interested in the relationship between the number of rooms occupied on a nightly basis and the revenue per day in the restaurant. Below is a sample of 25 days (Monday through Thursday) from last year showing the restaurant income and number of rooms occupied.
| Day | Revenue | Occupied | Day | Revenue | Occupied | ||||||||
| 1 | $ | 1,452 | 30 | 14 | $ | 1,425 | 31 | ||||||
| 2 | 1,361 | 29 | 15 | 1,445 | 34 | ||||||||
| 3 | 1,426 | 31 | 16 | 1,439 | 34 | ||||||||
| 4 | 1,470 | 32 | 17 | 1,348 | 31 | ||||||||
| 5 | 1,456 | 32 | 18 | 1,450 | 30 | ||||||||
| 6 | 1,430 | 32 | 19 | 1,431 | 30 | ||||||||
| 7 | 1,354 | 29 | 20 | 1,446 | 31 | ||||||||
| 8 | 1,442 | 30 | 21 | 1,485 | 34 | ||||||||
| 9 | 1,394 | 32 | 22 | 1,405 | 30 | ||||||||
| 10 | 1,459 | 32 | 23 | 1,461 | 32 | ||||||||
| 11 | 1,399 | 31 | 24 | 1,490 | 30 | ||||||||
| 12 | 1,458 | 31 | 25 | 1,426 | 30 | ||||||||
| 13 | 1,537 | 34 | |||||||||||
Choose the scatter diagram that best fits the data.
| Scatter diagram 1 | Scatter diagram 2 | Scatter diagram 3 |
Scatter diagram 1
Scatter diagram 2
Scatter diagram 3
Determine the coefficient of correlation between the two variables. (Round your answer to 3 decimal places.)
Pearson correlation _______
c-1. State the decision rule for 0.01 significance level: H0: ρ ≤ 0; H1: ρ > 0. (Round your answer to 3 decimal places.)
Reject H0 if t > ________
c-2. Compute the value of the test statistic. (Round your answer to 2 decimal places.)
Value of the test statistic ______
What percent of the variation in revenue in the restaurant is accounted for by the number of rooms occupied? (Round your answer to 1 decimal place.)
_____ % of the variation in revenue is explained by variation in occupied rooms.
In: Statistics and Probability
Under which two situations can a firm utilize the percentage completion method to recognize revenue as the asset for sale is being constructed?
In: Accounting
What is the primary difference between an in-state 4.2% YTM Revenue Municipal Bond, a 2.65% YTM U.S. T-Note, and a BB-Rated 6.72% YTM Corporate Debenture (assuming each has 8 years to maturity and Muni uses a tax-equivalent yield) in terms of tax treatment of coupon interest and default risk (how each is collateralized). Also, assume a marginal tax rate of 28%?
In: Finance
ECONOMICS FOR MANAGERS-GROUP ASSIGNMENT II
The relationship between marginal revenue and price elasticity of
demand is given asMR = P(1+1/ed), where MR is marginal revenue, P
is price of the commodity and Ed is the
coefficient of price elasticity of demand. As a manager of a
business firm in Accra, explain with
appropriate illustrati ons how the above relationship will guide
you in making pricing and output
decisions of your firm.
In: Economics
REVENUE CASE 3
Aman & Afdal is the auditor of Warisan Sdn Bhd. He is in charge of auditing the sales and collection cycle for the company which is a small fish distributor in East Malaysia. The company is respected for its high-quality fish products, but its accounting office is perpetually neglected, and the sales department frequently makes errors in billing clients. In previous years, Aman & Afdal has found quite a few misstatements in billings, cash receipts, and accounts receivable. Like many companies, the largest assets are accounts receivable, inventory and fixed assets.
The company is also slow at improving its identified internal control weaknesses in the previous year’s audit. Among those weaknesses is shipment is made immediately whenever orders are received and no screening of credit approval is made by Warisan before shipping. Besides, a copy of the shipping document is filed with the sales invoice and sales order, but there is no thorough review done on the documents by supervisors. The accounts receivable general ledger account and the subsidiary ledger accounts are posted by the same person, and there is no independent periodic reconciliation between the control account and subsidiary ledger accounts.
Warisan has several large loans payable to local banks, and two banks have told management that they are reluctant to extend more credit, especially considering that a bigger and well-known fish distributor is moving into the area. In previous years, the response from clients of Warisan to confirmation requests has been frustrating at best. The response rate has been extremely low, and those who did respond did not know the purpose of the confirmations or their correct outstanding balance. Aman & Afdal have had the same experience in confirming receivables with other, similar organisations. Aman & Afdal concludes that control over cash is excellent and the likelihood of fraud is extremely small.
Required:
I) Identify the major factors affecting the audit risk of Warisan Sdn Bhd.
(6 Marks)
II) For each of the internal control weaknesses in Warisan Sdn Bhd, describe the tests of control and substantive audit procedures that must be performed to minimize the control risk.
(11 Marks)
III) Since the response rate for external confirmations of accounts receivable balance is extremely low, what alternative procedures would you suggest the auditor do?
(3 Marks)
(Total: 20 Marks)
In: Accounting
Unoccupied seats on flights cause airlines to lose revenue. Suppose a large airline wants to determine of the mean number of unoccupied seats on all its flights is greater than 10. To accomplish this, the records of 60 flights are randomly selected and the number of unoccupied seats is noted for each of the sampled flights. The sample mean is 11.2 seats and the sample standard deviation is 3.4 seats. Test the claim that mean number of unoccupied seats on all its flights is greater than 10 at the 5% significance level.
For any Hypothesis Test make sure to state Ho, Ha, Test statistic, p-value, whether you reject Ho, and your conclusion in the words of the claim.
For any confidence interval make sure that you interpret the interval in context, in addition to using it for inference.
round to the thousandths place
In: Statistics and Probability
Unoccupied seats on flights cause airlines to lose revenue. Suppose a large airline wants to determine of the mean number of unoccupied seats on all its flights is greater than 10. To accomplish this, the records of 60 flights are randomly selected and the number of unoccupied seats is noted for each of the sampled flights. The sample mean is 11.2 seats and the sample standard deviation is 3.4 seats. Test the claim that mean number of unoccupied seats on all its flights is greater than 10 at the 5% significance level.
For any Hypothesis Test make sure to state Ho, Ha, Test statistic, p-value, whether you reject Ho, and your conclusion in the words of the claim.
For any confidence interval make sure that you interpret the interval in context, in addition to using it for inference.
round to the thousandths place
In: Statistics and Probability
What are some examples of how Amazon supports business revenue and profit growth by managing innovation?
Provide examples of how Amazon demonstrates its commitment to operating as an ethical organization.
In: Operations Management
In: Accounting
1.To be relevant in decision making, cost or revenue information must be future-oriented and differ between the alternatives.
True
False
2. Stephanie must decide between two alternatives for the weekend: babysitting or yard work. If she babysits, she will receive $40 and will incur $15 in food and snack costs. If she does yard work, she will receive $40 and will incur $3 in lawn mower gas and oil costs and $5 in snack costs. The amount of money she would receive for the jobs is relevant in deciding which alternative to select.
True
False
3. Differential revenues are expected future revenues that vary between the alternatives under consideration.
True
False
In: Economics