What is the estimated bad debt expense using the percentage of credit sales method
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Using the information given and the z-distribution, it is found that:
a) The point estimate of the population proportion is 0.5544.
b) The margin of error is: 0.0320.
c) The interval is: (0.5224, 0.5864).
d) The interpretation of the interval is: we are 95% sure that the true population proportion is between 0.5224 and 0.5864.
<h3>What is a confidence interval of proportions?</h3>A confidence interval of proportions has the bounds given by the rule presented as follows:
In which the variables used to calculated these bounds are listed as follows:
is the point estimate of the population proportion.
- z is the critical value.
- n is the sample size.
The confidence level is of 95%, hence the critical value z is the value of Z that has a p-value of , so the critical value is z = 1.96.
From the sample, the sample size and the point estimate are given as follows:
The margin of error is given by:
M = 0.0320.
The interval is the point estimate plus/minus the margin of error, hence:
- Lower bound: 0.5544 - 0.0320 = 0.5224.
- Upper bound: 0.5544 + 0.0320 = 0.5864.
More can be learned about the z-distribution at brainly.com/question/25890103
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