A statistical program is recommended.
A study investigated the relationship between audit delay (Delay), the length of time from a company's fiscal year-end to the date of the auditor's report, and variables that describe the client and the auditor. Some of the independent variables that were included in this study follow.
| Industry | A dummy variable coded 1 if the firm was an industrial company or 0 if the firm was a bank, savings and loan, or insurance company. |
|---|---|
| Public | A dummy variable coded 1 if the company was traded on an organized exchange or over the counter; otherwise coded 0. |
| Quality | A measure of overall quality of internal controls, as judged by the auditor, on a five-point scale ranging from "virtually none" (1) to "excellent" (5). |
| Finished | A measure ranging from 1 to 4, as judged by the auditor, where 1 indicates "all work performed subsequent to year-end" and 4 indicates "most work performed prior to year-end." |
A sample of 40 companies provided the following data.
| Delay | Industry | Public | Quality | Finished |
|---|---|---|---|---|
| 62 | 0 | 0 | 3 | 1 |
| 45 | 0 | 1 | 3 | 3 |
| 54 | 0 | 0 | 2 | 2 |
| 71 | 0 | 1 | 1 | 2 |
| 91 | 0 | 0 | 1 | 1 |
| 62 | 0 | 0 | 4 | 4 |
| 61 | 0 | 0 | 3 | 2 |
| 69 | 0 | 1 | 5 | 2 |
| 80 | 0 | 0 | 1 | 1 |
| 52 | 0 | 0 | 5 | 3 |
| 47 | 0 | 0 | 3 | 2 |
| 65 | 0 | 1 | 2 | 3 |
| 60 | 0 | 0 | 1 | 3 |
| 81 | 1 | 0 | 1 | 2 |
| 73 | 1 | 0 | 2 | 2 |
| 89 | 1 | 0 | 2 | 1 |
| 71 | 1 | 0 | 5 | 4 |
| 76 | 1 | 0 | 2 | 2 |
| 68 | 1 | 0 | 1 | 2 |
| 68 | 1 | 0 | 5 | 2 |
| 86 | 1 | 0 | 2 | 2 |
| 76 | 1 | 1 | 3 | 1 |
| 67 | 1 | 0 | 2 | 3 |
| 57 | 1 | 0 | 4 | 2 |
| 55 | 1 | 1 | 3 | 2 |
| 54 | 1 | 0 | 5 | 2 |
| 69 | 1 | 0 | 3 | 3 |
| 82 | 1 | 0 | 5 | 1 |
| 94 | 1 | 0 | 1 | 1 |
| 74 | 1 | 1 | 5 | 2 |
| 75 | 1 | 1 | 4 | 3 |
| 69 | 1 | 0 | 2 | 2 |
| 71 | 1 | 0 | 4 | 4 |
| 79 | 1 | 0 | 5 | 2 |
| 80 | 1 | 0 | 1 | 4 |
| 91 | 1 | 0 | 4 | 1 |
| 92 | 1 | 0 | 1 | 4 |
| 46 | 1 | 1 | 4 | 3 |
| 72 | 1 | 0 | 5 | 2 |
| 85 | 1 | 0 | 5 | 1 |
a) Develop the estimated regression equation using all of the independent variables. Use x1 for Industry, x2 for Public, x3 for Quality, and x4 for Finished. (Round your numerical values to two decimal places.)
ŷ = 80.43+11.94x1−4.82x2−2.62x3−4.07x4
D) On the basis of your observations about the relationship between Delay and Finished, use best-subsets regression to develop an alternative estimated regression equation to the one developed in (a) to explain as much of the variability in Delay as possible. Use x1 for Industry, x2 for Public, x3 for Quality, and x4 for Finished. (Round your numerical values to two decimal places.)
ŷ =
In: Statistics and Probability
ADS Fashions is a specialty clothing store. Its credit managers are trying to decide which credit policy to choose from the following 3 proposals.
The company has an annual opportunity cost and cost of capital of 10%. Assume Variable Costs occur at time 0, and that Sales less Bad Debt Costs less Credit Administration & Collection expenses all occur on the latest payment date that customers pay for credit sales. The Variable Cost Ratio (VCR) is 40% for each of the proposals.
Find the PV of revenues less PV Costs for each of the following policies to see which one gives the highest present value (PV), and explain which Policy would be best, i.e. give the highest Daily PV of Revenues – PV Costs.
(Policy 1) Under its existing credit policy, the company has Annual Credit Sales of $10,000,000. Bad debts as a percentage of total sales of 2%. Credit administration and Collection expenses as a percentage of total sales of 3%. Customers take on average 30 days to pay.
(Policy 2) Under a proposed new, more relaxed credit policy 2, the firm’s Annual Credit Sales are expected to rise to $12,000,000. Bad debts as a percentage of total sales are expected to rise to 2.5% of sales. Credit administration and Collection expenses as a percentage of total sales are expected to go up to 3.5%, and Customers are expected to take 40 days to pay.
(Policy 3) Under a proposed new credit policy 3, the firm would offer a Discount of 2%, with terms of 2/10, net 40, and 50% of customers would be expected to take the 2% discount and pay on day 10, and 50% of customers would be expected to not take the discount and pay on day 40. Credit Sales annually are expected to go up to $12,500,000. Bad debts are be expected to fall to 2%, and Credit administration and Collection expenses as a percentage of sales are expected to fall to 1.5%.
In: Accounting
|
Suppose a financial manager buys call options on 13,000 barrels of oil with an exercise price of $74 per barrel. She simultaneously sells a put option on 13,000 barrels of oil with the same exercise price of $74 per barrel. What are her payoffs per barrel if oil prices are $66, $70, $74, $78, and $82? (Leave no cells blank - be certain to enter "0" wherever required. A negative answer should be indicated by a minus sign.) |
In: Finance
The scores on a math test are normally distributed with a mean of 74 and a standard deviation of 8. The test scores range from 0 to 100. Seven students had test scores between 82 and 98. Estimate the number of students who took the test.
In: Statistics and Probability
The mean of a population is 74 and the standard deviation is 16. The shape of the population is unknown. Determine the probability of each of the following occurring from this population.
a. A random sample of size 32 yielding a sample
mean of 78 or more
b. A random sample of size 130 yielding a sample
mean of between 71 and 76
c. A random sample of size 219 yielding a sample
mean of less than 74.7
(Round all the values of z to 2 decimal places and
final answers to 4 decimal places.)
In: Statistics and Probability
The mean of a population is 74 and the standard deviation is 16. The shape of the population is unknown. Determine the probability of each of the following occurring from this population.
a. A random sample of size 32 yielding a sample mean of 76 or more
b. A random sample of size 130 yielding a sample mean of between 72 and 76
c. A random sample of size 220 yielding a sample mean of less than 74.3
In: Math
A company should adjust pension expense for which type of revenue(s) accumulated in the pension fund?
Select one:
a. Interest Revenue, but not Dividend Revenue
b. Dividend Revenue, but not Interest Revenue
c. Both Dividend Revenue and Interest Revenue
d. Neither Dividend Revenue nor Interest Revenue
In: Accounting
Company X database
Create an ER Diagram using UML notation for the following tables, then write out in the Relational model.
Company X is a manufacturing company that binds and sells books. They have hired you to create database to track their Employees, Products, customers and their orders. All employees work with book Binding, Only some are designated as Reps for customers. Reps may have many customers.
But each customer can only have 1 rep. They count to record each Books author, title, price, published year, publisher, and ISBN#
In: Computer Science
Gators technology CO. introduced a new Product X to the market on January 1, 201X. It carries a one year warranty. In its first month on the market, Gators sold 1,000 Units of this product for a total of $1,000,000. CUstomers have an unconditional right to return in 90 days if they are not completely satisfied with the product. During the first month, customers returned 400 units of the new product that they had purchases for $400,000. Required : Determine when it would be appropriate for Gators to recognize revenue from the first month sales of this product. Base your evaluation on IAS 18.
In: Accounting
The WIX Company Civil Engineers consists of two divisions. The divisions are Water and Waste Water. The company sells engineering services to various customers. The following are the bill rates for the various staff classifications:
Vice President $200/hour
Senior Engineer $180/hour
Staff Engineer $150/hour.
The two divisions expect to bill the following hours:
Water- 10000 hours, vice president at 10% of the time, 30% of Senior Engineer time and remaining to Staff Engineers.
Waste Water- 6000 hours, vice president at 20% of the time, 20% of Senior Engineer time and remaining to Staff Engineers.
The Direct Labor costs per hours are as follows:
Vice President $80/hour
Senior Engineer $60/hour
Staff Engineer $40/hour.
The utilization for each staff members are as follows:
Vice President 60%
Senior Engineer 80%
Staff Engineer 90%.
The company has the following other costs:
Admin Salaries $90,000
Rent $100,000
Utilities $6,000
Benefits $76,000
Assume 20% of time for each staff member includes vacation and sick time. 2080 is the annual total work hours.
Project Part II:
(1). Prepare a static budget for the company.
(2). Assume that the actual utilization came in at the following rates:
VP-50% Senior-82% Staff-93%
Based on the above utilization, prepare a flexible budget and calculate the Level 2/3 variances.
(3). What recommendations can be made for the upcoming year in budgeting to the CFO for additional profitability and increasing revenue?
(4). What approaches would your recommendations to increase the company overall utilization of staff and billable hours?
(5). How will your recommendations impact customer profitability or divisional profitability?
(6). The company wants to add a new division. It will be the Construction Division with 3 people. Please discuss pros and cons of adding a division and when you might consider not to add the division.
In: Accounting