Capital College of Accountancy & MGT May 2025 Assessment I CPA Paper 3

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CAPITAL COLLEGE OF ACCOUNTANCY & MANAGEMENT

CPA -Paper 3

Assessment I

May 2025
Saturday/Monday
March 22nd, 2025

INSTRUCTIONS TO CANDIDATES

1. Time allowed: 1hr. 30 minutes. The first 15 minutes of this examination have been designated
for reading time. You may not start to write your answer during this time.

2. This examination contains Three questions and ALL questions are to be attempted. Each
question carries 20 marks.

3. Write your answer to each question on a fresh page in your answer booklet.

4. Follow instructions as per the question to be attempted

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 Capital College of Accountancy & MGT May 2025 Assessment I CPA Paper 3
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Question One
(a)(i) Differentiate between an interview and a questionnaire as methods of collecting data.

(2marks)

(ii) The probability that an employee is early for work is 0.45. In a given week 6 employees
were monitored for the time they reported for work. Determine the probability that at most
2 employees were late for work. (4marks)

(b) During a field tour to find out the health status of residents in Pomfret Centre, in Makindye,
the weights of 90 residents were captured. It was later found that their average weight was
56Kg. By error, the data entrant lost some records and the number of residents aged
between 20-40 and 60-80 were lost.

Weight (Kg) 0 - 20 20 - 40 40 - 60 60 - 80 80 - 100 100 - 120

No. of residents 16 a 25 b 12 10
Determine (i) the values of a and b. (4marks)

(ii) the geometric mean of the participants (5marks)

(c) A sample of 80 employees has an average pay of 750 USD with a standard deviation of 25.
Determine the 95% confidence interval for the average pay in the organisation. (5marks)

Question Two
(a)(i) Jax Inc. priced her merchandise using the different prices for the years 1 and 2 as per the
table below with [Year 1 = 100]

Weights Prices

Commodity Year 1 Year 2 Year 1 Year 2

A 5 4 215 210

B 12 10 250 275

C 2 2 1100 1300

D 8 5 950 950
Determine the cost of living index using the average weighted relative index. (3marks)

(ii) The probability that an accident happens on a road is known to be 0.25%. In a given month
1600 cars were observed on Mpigi – Jinja highway. Determine the probability that at least
3 cars were involved in an accident assuming that accidents follow a poisson situation.
(3marks)
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 Capital College of Accountancy & MGT May 2025 Assessment I CPA Paper 3
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(b) The costs of production incurred by CCAM Inc. a beverages company, were as noted
together with their expectations.

Cost’ 00 USD 800 1200 750 600 1000 1600 400

Expectation 0.15 0.05 0.25 0.20 0.10 0.15 0.10

Determine (i) the standard deviation in the cost of production. (5marks)

(ii) the coefficient of variation and comment on your result. (3marks)

(c) (i) Outline any two properties of the Binomial distribution. (2marks)

(ii) A sample of 80 students that attended the AFRI-CULTURAL seminar had their weights
recorded by African Cultural research center as shown.

Weight 20-29 30-39 40-49 50-59 60-69 70-79 80-99 100-119 120-149

Number 5 12 6 11 15 8 10 8 5
of
Students
Determine the Harmonic mean for the first 49 students. (4marks)

Question Three
(a)(i) Differentiate between the Binomial and the Poisson distributions. (2marks)

(ii) The average pay of employees in Water-Town, Mpererwe is known to be 800 USD with a
standard deviation of 16 USD. If the company has 3500 employees, how many received
between 776 USD and 828 USD? (4marks)

(b) (i) In Bronx, Kabale, P-Inc uses 120 trucks to transport raw materials from a quarry to a construction
site. The travel time (in minutes) of the trucks using a fixed route was recorded as shown.

Time (min) 10-19 20-29 30-39 40-49 50-59 60-69 70-79 80-89

Trucks 3 14 12 18 27 19 15 12
Determine the 80 percentile time that a truck would take to deliver raw materials.
th
(4marks)

(ii) Marchese Inc. normally pays 20000 USD to contractors A, B and C for her real estate
development works. In a given month contractors B and C were paid 8000 USD and 6000
USD respectively. The probabilities that A and B do a good job were known to be 75%
and 80% respectively whereas the probability that C performs poorly on the contract is 16%.
Determine the probability that a contract was executed by A given that it was poorly done.
(Hint: You may use a probability tree) (3marks)

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 Capital College of Accountancy & MGT May 2025 Assessment I CPA Paper 3
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(c) Registration of students at the college is a random exercise that follows a binomial
distribution in the form 𝑋𝑋 ∼ (80, 0.75), where X is the number of registrations made.
Required: (i) Explain whether the students’ registration can be approximated to the normal
distribution. (2marks)

(ii) By approximation to the normal distribution, determine the probability that at least 49
students registered with the college. (5marks)

END

Formula Sheet

1. The Mean: 𝑥𝑥� =

∑(𝑓𝑓.𝑥𝑥)
∑ 𝑓𝑓

2. Mode = 𝐿𝐿 + �(𝑓𝑓
𝑓𝑓𝑚𝑚− 𝑓𝑓𝑏𝑏
� ∗ 𝑐𝑐𝑤𝑤
𝑚𝑚− 𝑓𝑓𝑏𝑏 )+(𝑓𝑓𝑚𝑚− 𝑓𝑓𝑎𝑎 )

𝑥𝑥−𝐹𝐹𝑄𝑄
3. The Quantile = 𝐿𝐿 + � � 𝐶𝐶𝑄𝑄
𝑓𝑓𝑄𝑄

4. Var(x) = ∑[𝑥𝑥 2 𝑝𝑝(𝑥𝑥)] − (∑ 𝑥𝑥. 𝑝𝑝(𝑥𝑥))2

5. The Geometric Mean:
∑(𝑓𝑓. 𝑙𝑙𝑙𝑙𝑙𝑙𝑥𝑥𝑖𝑖 )
𝐺𝐺𝐺𝐺 = 𝑎𝑎𝑎𝑎𝑎𝑎𝑎𝑎𝑎𝑎𝑎𝑎𝑎𝑎 � �
∑ 𝑓𝑓

6. The Harmonic Mean: 𝐻𝐻𝐻𝐻 =

∑ 𝑓𝑓𝑖𝑖
𝑓𝑓
∑� �
𝑥𝑥𝑖𝑖

7. Confidence Interval of the population mean: 𝜇𝜇 = 𝑥𝑥̄ ± 𝑧𝑧

𝑠𝑠
√𝑛𝑛

8. The Z standard value of a random variable x: 𝑍𝑍 =

𝑥𝑥−𝜇𝜇
𝜎𝜎

9. Coefficient of variation: 𝐶𝐶𝐶𝐶 =

𝜎𝜎
𝑥𝑥 100
µ

10. Conditional Probability: P(A/B) = P(AnB)/P(B)

11. The Binomial Distribution: P(r) = nCr *pr *(1 – p)n-r
⋋𝑟𝑟
12. The Poisson Distribution: 𝑃𝑃(𝑟𝑟) = 𝑒𝑒 −⋋ .
𝑟𝑟!

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 Capital College of Accountancy & MGT May 2025 Assessment I CPA Paper 3
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