The Center Line (P-Bar) for a P-Chart Is 0

question 1

Multiple Choice

The center line (p-bar) for a p-chart is 0.50 with an UCL = 0.70 and a LCL = 0.35.The results of the next eight sample means are 0.45, 0.60, 0.39, 0.44, 0.48, 0.53, 0.54, and 0.61.What would you do?

• A)Nothing; the process is in control.
• B)increase the sample size to get a better measure.
• C)investigate assignable causes because four observations are above the center line.
• D)investigate assignable causes because there is a bad trend (run).

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Definitions:

Accounts Receivable

Funds that are owed to a company by customers for goods or services delivered or used but not yet paid for.

Bad Debt Expense

An expense recognized when a company determines that a customer's debt is no longer collectible.

Cash Realizable Value

The amount of money that could be realized from assets if they were sold, after settling any associated costs.

Allowance Method

The allowance method is an accounting technique that enables companies to anticipate and adjust for expected bad debts or credit losses in their financial statements.