Question

While reviewing the sample of audit​ fees, a senior accountant for the firm notes that the fee charged by the​ firm's accountants depends on the complexity of the return. A comparison of actual charges therefore might not provide the information needed to set next​ year's fees. To better understand the fee​ structure, the senior accountant requests a new sample that measures the time the accountants spent on the audit. Last​ year, the average hours charged per client audit was 3.18 hours. A new sample of 15 audit times shows the following times in hours. Complete parts a and b below. 2.7 3.6 4.4 3.9 4.9 4.2 2.9 4.2 3.7 4.9 3.7 3.4 3.1 3.9 4.9

Answer 1

	Data
	2.7
	3.6
	4.4
	3.9
	4.9
	4.2
	2.9
	4.2
	3.7
	4.9
	3.7
	3.4
	3.1
	3.9
	4.9
Mean(X bar)	3.893333333
Standard deviation(S)	0.703528522
n	15
tc	1.76	α=0.1	df=(n-1)=14
90% CI
Upper limit	4.213037832	X bar + tc*S/SQRT(n)
Lower limit	3.573628835	X bar - tc*S/SQRT(n)

90% CI = (3.5736,4.2130)

Given last​ year, the average hours charged per client audit was 3.18 hours and it is below the interval and mean audit time has increased