TABLE 10-14
a Problem with a Telephone Line That Prevents $$\text { t-Test: Two- Sample Assuming Unequal Variances }$$

question 152

Short Answer

TABLE 10-14
A problem with a telephone line that prevents a customer from receiving or making calls is disconcerting to both the customer and the telephone company. The data on samples of 20 problems reported to two different offices of a telephone company and the time to clear these problems (in minutes) from the customers' lines are collected. Below is the Excel output to see whether there is evidence of a difference in the mean waiting time between the two offices assuming that the
population variances in the two offices are not equal.
$$\text { t-Test: Two- Sample Assuming Unequal Variances }$$
$$\begin{array} { l r r } & \text { Office 1 } & \text { Office 2 } \\\hline \text { Mean } & 2214 & 2.0115 \\\text { Variance } & 2.951657 & 3.57855 \\\text { Observations } & 20 & 20 \\\text { Hypothesized Mean Difference } & 0 & \\\mathrm { df } & 38 & \\\mathrm { t } \text { Stat } & 0.354386 & \\\mathrm { P } ( \mathrm { T } < = \mathrm { t } ) \text { one- tail } & 0.362504 & \\\mathrm { t } \text { Critical one- tail } & 1.685953 & \\\mathrm { P } ( \mathrm { T } < = \mathrm { t } ) \text { two- tail } & 0.725009 & \\\mathrm { t } \text { Critical two-tail } & 2.024394 & \\\hline\end{array}$$

-Referring to Table 10-13, construct a 95% confidence interval estimate of the difference in proportion between the Kohler and Russell disks that are defective.

Understand the operation of merchandisers and retailers and the role of inventory in their financial transactions.

Grasp the implications and application of credit terms in sales transactions.

Identify the accounting treatment for sales tax payable and the importance of sales tax in financial transactions.

Understand the procedures for handling and recording merchandise returns from customers.

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Definitions:

Implicit Costs

The opportunity costs associated with a company's own resources, not directly paid for with cash but are the result of using assets instead of investing them elsewhere.

Economic Profit

The difference between total revenue and the total costs, including both explicit and implicit costs, unlike accounting profit which only considers explicit costs.

Explicit Costs

Direct financial payments made to acquire resources or services for business operations.

Total Economic Costs

The sum of explicit and implicit costs representing the total resources expended in the production of goods or services.