Using samples of 197 credit card statements, an auditor found the following: Sample 1 3 errors Sample 2 3 errors Sample 3 5 errors Sample 4 9 errors 1. what alpha risk would control limits of .0470 and .0038 provide? 2. Using control limits of .0470 and .0038, is the process in control? 3. Construct a control chart for the process, assuming a fraction defective of 2 percent, using two-sigma control limits. Is the process in control?
Using samples of 197 credit card statements, an auditor found the following: Sample 1 3 errors Sample 2 3 errors Sample 3 5 errors Sample 4 9 errors 1. what alpha risk would control limits of .0470 and .0038 provide? 2. Using control limits of .0470 and .0038, is the process in control? 3. Construct a control chart for the process, assuming a fraction defective of 2 percent, using two-sigma control limits. Is the process in control?
Practical Management Science
6th Edition
ISBN:9781337406659
Author:WINSTON, Wayne L.
Publisher:WINSTON, Wayne L.
Chapter2: Introduction To Spreadsheet Modeling
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Question
Using samples of 197 credit card statements, an auditor found the following:
Sample 1 3 errors
Sample 2 3 errors
Sample 3 5 errors
Sample 4 9 errors
1. what alpha risk would control limits of .0470 and .0038 provide?
2. Using control limits of .0470 and .0038, is the process in control?
3. Construct a control chart for the process, assuming a fraction defective of 2 percent, using two-sigma control limits. Is the process in control?
.
| Sample | 1 | 2 | 3 | 4 |
|--------|---|---|---|---|
| Number with errors | 3 | 3 | 5 | 9 |
The table above illustrates the number of errors found in four different samples of credit card statements. Each sample represents a subset of the 197 statements reviewed. The errors identified were distributed as follows:
- In Sample 1, there were 3 errors.
- In Sample 2, there were 3 errors.
- In Sample 3, there were 5 errors.
- In Sample 4, there were 9 errors.
This data helps in understanding the frequency and distribution of errors across different samples, which may further assist in refining auditing processes or identifying areas needing attention.](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Fbfccd489-2da6-42f1-848f-e1ad09aad697%2F428d0773-6032-47e1-9e29-94e76450675c%2F66n901_processed.png&w=3840&q=75)
Transcribed Image Text:**Audit Analysis of Credit Card Statements**
Using samples of 197 credit card statements, an auditor found the following:
Refer to [Table-A](#).
| Sample | 1 | 2 | 3 | 4 |
|--------|---|---|---|---|
| Number with errors | 3 | 3 | 5 | 9 |
The table above illustrates the number of errors found in four different samples of credit card statements. Each sample represents a subset of the 197 statements reviewed. The errors identified were distributed as follows:
- In Sample 1, there were 3 errors.
- In Sample 2, there were 3 errors.
- In Sample 3, there were 5 errors.
- In Sample 4, there were 9 errors.
This data helps in understanding the frequency and distribution of errors across different samples, which may further assist in refining auditing processes or identifying areas needing attention.
.
| Sample | 1 | 2 | 3 | 4 |
|------------------|---|---|---|---|
| Number with errors | 3 | 3 | 5 | 9 |
**Explanation:**
The table displays data from four samples of credit card statements. For each sample, the number of statements with errors is recorded:
- Sample 1: 3 errors
- Sample 2: 3 errors
- Sample 3: 5 errors
- Sample 4: 9 errors](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Fbfccd489-2da6-42f1-848f-e1ad09aad697%2F428d0773-6032-47e1-9e29-94e76450675c%2F1lwatgr_processed.png&w=3840&q=75)
Transcribed Image Text:Using samples of 197 credit card statements, an auditor found the following: Use [Table-A](#).
| Sample | 1 | 2 | 3 | 4 |
|------------------|---|---|---|---|
| Number with errors | 3 | 3 | 5 | 9 |
**Explanation:**
The table displays data from four samples of credit card statements. For each sample, the number of statements with errors is recorded:
- Sample 1: 3 errors
- Sample 2: 3 errors
- Sample 3: 5 errors
- Sample 4: 9 errors
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