The Annual Income of Residents in a County Is $42,000

question 37

Multiple Choice

The annual income of residents in a county is $42,000 with a standard deviation of $10,000. Under the assumption that the distribution of annual incomes is Normal, between what two values do 95% of the incomes of county residents lie?

• A) $40,000 and $44,000
• B) $22,000 and $62,000
• C) $32,000 and $52,000
• D) $30,000 and $50,000

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Definitions:

ABC System

Activity-Based Costing System; a method of allocating overhead and indirect costs to specific products or services based on the activities they require.

Traditional Cost Systems

Traditional cost systems allocate overhead costs based on measures like direct labour hours or machine hours, often resulting in less accurate product costing.

Committed Resource

Assets or inputs that a company has dedicated to a certain project or operational activity, reflecting a long-term investment or commitment.

ABC Implementation

The process of applying Activity-Based Costing, an accounting method that assigns costs to activities based on their use of resources.