A Random Sample of 40 Companies with Assets Over $10

question 49

Multiple Choice

A random sample of 40 companies with assets over $10 million was selected and asked for their annual computer technology expense and industry.The ANOVA comparing the average computer technology expense among three industries rejected the null hypothesis.The Mean Square Error (MSE) was 195.The following table summarized the results: Based on the comparison between the mean computer technology expense for companies in the Tax Service and Food Service industries,the 95% confidence interval shows an interval of -14.85 to 5.85 for the difference.This result indicates that

• A)There is no significant difference between the two expenses.
• B)The interval contains a difference of 20.7.
• C)Companies in the Tax Service industry spend significantly less than companies in the Food Service industry.
• D)Companies in the Food Service industry spend significantly less than companies in the Tax Service industry.

---

Definitions:

Average Cost Formula

A method used to calculate the cost of goods sold and ending inventory by taking the total cost of goods available for sale and dividing it by the total number of units available for sale.

Cost of Goods Sold

The cost of goods sold (COGS) refers to the direct costs attributable to the production of the goods sold by a company, including material and labor costs.

Specific Identification

An inventory valuation method where each item in inventory is matched with a specific cost.

Inventory Costing

Inventory costing is the method used to assign costs to inventory items, determining the cost of goods sold and remaining inventory value.