Examine a Contingency Table A) 31% (34 / 64)

question 10

Multiple Choice

Examine a contingency table.
-A full service brokerage firm gathered information on how their clients were investing
For retirement. Based on age, clients were categorized according to where the largest
Percentage of their retirement portfolio was invested and shown in the table below. The
Percentage of clients who are over age 50 and invest in mutual funds is $$\begin{array} { | l | c | c | c | } \hline & \begin{array} { l } \text { Age 50 or } \\\text { Younger }\end{array} & \begin{array} { l } \text { Over } \\\text { Age 50 }\end{array} & \text { Total } \\\hline \text { Mutual Funds } & 30 & 34 & \mathbf { 6 4 } \\\hline \text { Stocks } & 37 & 45 & \mathbf { 8 2 } \\\hline \text { Bonds } & 19 & 23 & \mathbf { 4 2 } \\\hline \text { Total } & \mathbf { 8 6 } & \mathbf { 1 0 2 } & \mathbf { 1 8 8 } \\\hline\end{array}$$

• A) 3.1% (34 / 64).
• B) 33.3% (34 / 102).
• C) 18.1% (34 / 188).
• D) 34% (64 / 188).
• E) 54.3% (102 / 188).

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Definitions:

Immediate Recognition

The accounting practice of reporting revenue or expenses in the current period as they are incurred, without deferral.

Sales Commissions

The expense related to the payment of commissions to sales personnel, typically calculated as a percentage of the sales revenue they generate.

Expense Recognition

An accounting principle that dictates when the cost of business operations should be recorded in the financial statements.