Tom and Brent 's Alpine Outfitters conducts an annual audit of its financial records An internal control policy for the company is that a check can be issued only after the accounts payable manager initials the invoice The tolerable exception rate for this internal control is 0 04 During an audit, ...

a b Since the upper bound is highe ...

Tom and Brent's Alpine Outfitters conducts an annual audit of its financial records. An internal control policy

Question:

Tom and Brent's Alpine Outfitters conducts an annual audit of its financial records. An internal control policy for the company is that a check can be issued only after the manager initials the invoice. The tolerable exception rate for this internal control is 0.04. During an audit, a sample of 300 invoices is examined from a population of 10,000 invoices, and 11 invoices are found to violate the internal control.
a. Calculate the upper bound for a 95% one-sided confidence interval estimate for the rate of noncompliance.
b. Based on (a), what should the auditor conclude?
Accounts Payable
Accounts payable (AP) are bills to be paid as part of the normal course of business.This is a standard accounting term, one of the most common liabilities, which normally appears in the balance sheet listing of liabilities. Businesses receive...