APPLICATION OF STATISTICS IN BUSINESS WHAT IS STATISTICS ? Meaning Significance of STATISTICS ROLE OF STATISTICS IN ACCOUNTING, FINANCE, MARKETING, PRODUCTION & ECONOMICS Quantative Data Graphs, Pie Charts, Dot Plots & Pareto Charts

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2. Business Statistics
B.BA (Spring-18)
Batch Fall-17
Presented To: Miss MADEEHA
University Of Gujrat
LHR Campus
Harbanspura, LAHORE

3. HASSAN
SHAHEER
Roll No :
17500920-010
Semester :
Spring-18
Batch : Fall-17

4. APPLICATION
OF
STATISTICS
IN
BUSINESS

5. • Statistics is the science that deals with the
collection, classification, analysis, and
interpretation of numerical facts or data, and
that, by use of mathematical theories of
probability imposes order and regularities on
aggregate of more or less disparate elements.

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• Statistics play a vital role in nearly all
businesses and form the backbone for all
future development Strategies .
• Every business plan starts with extensive
research and this is all complied into statistics
that can influence a final decision

7. • The word statistics is used in two different
senses.
• In plural sense statistics means data and in
singular sense statistics is science which deals
with the collection, presentation, analysis, and
interpretation of some numerical data.

8. • Statistics is a particularly useful branch of mathematics
that is not only studied theoretically but one that is used
by researches in many fields to organize analysis and
summarized data. Statistical methods and analyses are
often used to communicate research findings and to
support hypotheses and give reliability to conclusions.

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ROLE OF STATISTICS
IN
ACCOUNTING
FINANCE
MARKETING
PRODUCTION
ECONOMICS

10. • The Public accounting firms use statistical
sampling procedures when conducting audits for
their clients.
• For instance, suppose an accounting firm wants to
determine whether the amount of accounts
receivable shown on a client's balance sheet fairly
represents the actual amount of accounts
receivable.

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• Usually the large number of individual
accounts receivable makes review in and
validating every account too time-consuming
and expensive.
• As common practice in such situations, the
audit staff selects a subset of the accounts
called a sample.

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• After reviewing the accuracy of the sampled
accounts, the auditors draw a conclusion as to
whether the accounts receivable amount shown
on the client's balance sheet is acceptable

13. • Financial analysis uses a variety of statistical
information to guide their investment
recommendations.
• In the case of stocks, the analysis reviews a
variety of financial data
including price/earnings ratios and dividend yie
lds.

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• By comparing the Information for an
individual stockwith information about the
stock market averages, a financial analyst can
begin to draw a conclusion as to whether an
individual stock is over- or underpriced.

15. • Electronic scanners at retail checkout counters
collect data for a variety of marketing research
applications.
• For example, data suppliers and Information
purchase point-of-sale scanner data from
grocery stores, process the data, and then well
statistical summaries of the data to
manufacturers.

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• Manufacturers spend hundreds of thousands
of dollars per product category to obtain
scanner statistics and the promotional activity
statistics to gain a better understanding of the
relationship between promotional activities
and sales.

17. • Today's emphasis on quality makes quality
control that important application of statistics in
production.
• A variety of statistical quality control charts are
used to monitor the output of
a production process.

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• In particular, a v-bar
chart can be used to monitor the average out
put.
• Suppose, for example, that a machine fills
containers with a soft drink. Periodically,a
production worker selects a sample of
containers and computes the average number of
ounces in the sample.

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• This average, or the value, is plotted on a v-bar
chart. A plotted value above the chart' supper
control limit indicates overfilling, and a plotted
value below the chart's lower control limit
indicates under filling.

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• The process is termed ""in control"" and
allowed to continue as long as the plotted v-bar
values fall between the chart's upper and lower
control limits. Properly interpreted, a v-bar
chart can help determine when adjustments are
accessary to correct a production process

21. • Economists frequently provide forecasts about
the future of the economy or some aspect of it.
• They use a variety of statistical information in
making such forecasts.

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• For example, in forecasting inflation rates that
economist's use statistical information on such
indicators as the Producer Price Index, the
unemployment rate, and manufacturing
capacity utilization.
• These statistical indicators often entered into
computerized forecasting models that predict
inflation rates.

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Quantative Data Graphs
Pie Charts
Dot Plots
Pareto Charts

24. • A pie chart (or a circle chart) is a circular
statistical graphic which is divided into slices to
illustrate numerical proportion.
• In a pie chart, the arc length of each slice is
proportional to the quantity it represents.

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• While it is named for its resemblance to a pie
which has been sliced, there are variations on
the way it can be presented. The earliest known
pie chart is generally credited to William
Playfair's Statistical Breviary of 1801.

27. • A dot chart or dot plot is a statistical chart
consisting of data points plotted on a fairly
simple scale, typically using filled in circles.
There are two common, yet very different,
versions of the dot chart.

29. • A Pareto chart, named after Vilfredo Pareto, is
a type of chart that contains both bars and a
line graph, where individual values are
represented in descending order by bars, and
the cumulative total is represented by the line.