A Contractor Wants to Forecast the Number of Contracts in Future

question 45

Multiple Choice

A contractor wants to forecast the number of contracts in future quarters, using quarterly data on number of contracts during the 10-year period from 1997 to 2006. Which of the following would be the most appropriate analysis to perform?

• A) Laspeyres price index modeling
• B) two-way ANOVA
• C) autoregressive modeling
• D) least-squares forecasting with monthly or quarterly data

Distinguish between different legal doctrines and rules (e.g., Ultramares rule, Restatement (Second) of Torts) that affect accountant liability.

Recognize the role of privity of contract and the impact of third-party users on accountant's liability.

Understand the implications of securities laws (e.g., Securities Act of 1933, Securities Exchange Act of 1934) on accountants' responsibilities and liabilities.

Recognize the penalties and defenses applicable to accountants under common law and federal securities laws.

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Definitions:

LTPD

Lot Tolerance Percent Defective, a statistical measure in quality control that represents the maximum acceptable defect rate for a batch of products.

Defects

Imperfections or faults in a product that cause it to fall short of its intended quality or functionality.

Natural Variations

Differences in data points that occur naturally within a process, resulting from a multitude of small, random factors.

Control Limits

The boundaries in control charts within which a process is considered to be in a state of statistical control, and beyond which the process is considered out of control.