When Working for the Brooklyn District Attorney, Investigator Robert Burton

Essay

When working for the Brooklyn District Attorney, investigator Robert Burton analyzed the leading digits of the
amounts from 784 checks issued by seven suspect companies. The frequencies were found to be
0, 12, 0, 73, 482, 186, 8, 23, and 0, and those digits correspond to the leading digits of 1, 2, 3, 4, 5, 6, 7, 8, and 9,
respectively. If the observed frequencies are substantially different from the frequencies expected with Benford's
Law, the check amounts appear to result from fraud. Use a 0.05 significance level to test for goodness-of-fit
with Benford's Law. Does it appear that the checks are the result of fraud?