Exhibit 5-7 A Sample of 2,500 People Was Asked How Many Cups

question 142

Multiple Choice

Exhibit 5-7
A sample of 2,500 people was asked how many cups of coffee they drink in the morning. You are given the following sample information.
-The binomial probability distribution is used with

• A)a continuous random variable
• B)a discrete random variable
• C)any distribution, as long as it is not normal
• D)All of these answers are correct.

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Definitions:

Predetermined Overhead Rate

A rate used to allocate manufacturing overhead to products, calculated before the period begins based on estimated costs and activity levels.

Machine-Hours

The total hours that a machine is operational, used as a measure for allocating manufacturing overhead costs.

Plantwide Predetermined

A method that assigns overhead costs to products based on a single predetermined overhead rate for the entire factory or plant.

Manufacturing Overhead

Refers to all the indirect costs associated with the production process, excluding direct materials and direct labor costs.