You are using stratified mean-per-unit estimation in the confirmation of accounts receivable. You have already decided to use five strata, and the stratum boundaries have been set. A sample size of 250 positive confirmations has already been determined.

The following data have been determined from analyzing population data or by estimating:

Required :

a. Allocate the total sample to strata by using the “proportion to the recorded value” method.

b. Allocate the total sample to strata by using the Neyman method.

c. Explain which method is preferable under the circumstances.

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Population Strata size Estimated standard deviation Recorded population value 12345 4,000 2,000 120 400,000 200 300,000 1,000 350 600,000 500 600 500,000 50 2,000 200,000