A IRS Auditor Randomly Selects 3 Tax Returns from 42

question 79

Multiple Choice

A IRS auditor randomly selects 3 tax returns from 42 returns of which 15 contain errors. What is the probabilitythat none of the returns she selects contains an error?

• A) 0.2548
• B) 0.2657
• C) 0.0456
• D) 0.0396

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Definitions:

Split-Off Point

The stage in a process where different products have been sufficiently processed and can be recognized as distinct goods.

Weighted Average Method

An inventory valuation method that calculates the cost of goods sold and ending inventory based on the weighted average cost of all items available for sale during the period.

Joint Costs

The costs incurred in the process of producing two or more joint products before the point at which the products become separately identifiable.

Split-Off Point

In a production process, the stage at which jointly processed products become individually identifiable and able to be separated into distinct products.