Assume That the Accounts Payable Department of a Company Has

question 37

Essay

Assume that the accounts payable department of a company has five clerks; each one is paid $25,000 per year ($125,000 total clerical salaries). On average, the clerks spend:
20% of time on processing payments
30% of time matching invoices, receiving documents, and billing statement
50% of time correcting errors in the various documents
In addition, long distance telephone costs of $1,700 are directly traced to the activity "correcting errors."
A. Assign the clerical salary cost to each of the three activities.
B. Calculate the total cost of the "correcting errors" activity.

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Definitions:

Confounding Variable

A variable that influences both the dependent and independent variables in a study, potentially misleading the results if not controlled.

Independent Variable

The variable in an experiment that is manipulated to observe its effect on a dependent variable.

Internal Validity

The extent to which a study can demonstrate a cause-and-effect relationship between variables, free from external influence.

Random Assignment

A process used in experimental designs to assign subjects randomly to either the treatment group or the control group, ensuring that each participant has an equal chance of being placed in any group.