Determine Whether the Given Procedure Results in a Binomial Distribution

question 42

Multiple Choice

Determine whether the given procedure results in a binomial distribution. If not, state the reason why.
-Choosing 10 marbles from a box of 40 marbles (20 purple, 12 red, and 8 green) one at a time with replacement, keeping track of the number of red marbles chosen.

• A) Not binomial: the trials are not independent.
• B) Not binomial: there are too many trials.
• C) Procedure results in a binomial distribution.
• D) Not binomial: there are more than two outcomes for each trial.

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Definitions:

Variable Overhead

Costs that change in proportion to the level of manufacturing or service activities, such as materials and utilities.

Labour Efficiency Variance

It measures the effectiveness of labor usage by comparing the budgeted hours for a set level of production against the actual hours worked, indicating efficiency or inefficiency in labor use.

Static Budget

A budget that does not change or adjust over the period, established at the start of a period and based on a fixed level of activity.

Standard Costing

A cost accounting system that assigns a fixed cost to inventory with the variance analyzed to improve cost control and management decisions.