In recent years major efforts have been made to standardize accounting practices in different countries; this is
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a. Depreciation method is one of the accounting practices studied by Emenyonu and Gray. Three methods were considered— the straight- line method (S), the declining balance method (D), and a combination of D & S (sometimes European firms start with the declining balance method and then switch over to the straight- line method when the figure derived from straight line exceeds that from declining balance). The data in Table 12.4 summarize the depreciation methods used by a sample of 78 French, German, and U. K. firms. Use these data and the results of the chi- square analysis in Table 12.4 to test the hypothesis that depreciation method is independent of a firm’s location (country) at the .05 level of significance.
b. Perform a graphical analysis to study the relationship between depreciation method and country. What conclusions can be made about the nature of the relationship?
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Related Book For
Essentials Of Business Statistics
ISBN: 9780078020537
5th Edition
Authors: Bruce Bowerman, Richard Connell, Emily Murphree, Burdeane Or
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