In Most Acceptance Sampling Plans, When a Lot Is Rejected

question 150

Multiple Choice

In most acceptance sampling plans, when a lot is rejected, the entire lot is inspected and all defective items are replaced. When using this technique the AOQ:

• A) worsens (AOQ becomes a larger fraction).
• B) improves (AOQ becomes a smaller fraction).
• C) is not affected, but the AQL is improved.
• D) is not affected.
• E) falls to zero.

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Definitions:

Notes Receivable

Financial assets representing amounts owed to a company by others, typically from loans or credit extended, evidenced by promissory notes.

Journal Entry

The form of recording a transaction in a journal.

Maker

The entity or individual who creates or produces something, often used in contexts involving manufacturing or crafts.

Allowance for Doubtful Accounts

An accounting provision made to accommodate likely losses on accounts receivable due to customers being unable to pay.