Ginnian and Fitch, a regional accounting firm, performs yearly audits on a number of different for-profit and
Question:
Required:
1. Write out the cost equation for Ginnian€™s audit professional time.
2. If Ginnian expects to have 9 audits of not-for-profits next month and expects that audit professionals will have a total of 130 hours of not-for-profit training, what is the anticipated cost of professional time?
3. Calculate a 99 percent confidence interval for the prediction made in Requirement 2.
4. Are the hours spent auditing not-for-profit entities positively or negatively correlated with audit professional costs? Is percentage of experienced team members positively or negatively correlated with audit professional cost?
5. What does R2 mean in this equation? Overall, what is your evaluation of the cost equation that was developed for the cost of audit professionals?
Step by Step Answer:
Cornerstones of Cost Management
ISBN: 978-1285751788
3rd edition
Authors: Don R. Hansen, Maryanne M. Mowen