3.

5 Sample Size Determination

The sample size of the study population is determined using Kothari (2004) formula. Thus, using
the total population of 770 at 95 percent confidence level and error margin of 0.05, the actual
sample size is determined. If N is less than or equal to 10,000, then the sample size is calculated

n
f (n)=
by the formula: n= n ,
(1+ )
N
where N = Target population size
n = Desired sample size
z = Confidence level (95%= standard value is 1.96)
p = Estimated characteristics of study population (0.5)
q = 1-p
e = levels of statistical significance (standard value is 0.05)
z 2 pq
n= , where z= 1.96, p=0.5, q=1-0.5, e=0.05
e2
( 1.96 ) 2 ( 0.5 ) ( 0.5) 3.84 x 0.25
n= = = 384 for N is greater than, less than or equal to
(0.05)2 0.0025
10,000.
n
f (n)=
n= n ,
(1+ )
N
384
384 384
The sample size will be; n=f(n)= 384 = = = 256
(1+ ) (1+0.4518) 1.499
770

3.6 Cochran’s formula for calculating sample size when population size is finite:
Cochran pointed out that if the population is finite, then the sample size can be reduced slightly.
This is due to the fact that a very large population provides proportionally more information than
that of a smaller population. He proposes a correction formula to calculate the final sample size
in this case which is given below. This is because a given sample size provides proportionately
more information for a small population than for a large population. The sample size (no) can be
adjusted by Formula as follows.
 no
n= 1+ ( no−1 )
−−−¿ N
256
n= 1+ ( 256−1 )
77 0
256
n= =192, the sample size available for research
1.33
Where
N=population size, no=Sample size, n=adjusted sample size formula, e=is acceptable sample error
which is 0.05
Therefore, 192 respondents will be selected as a representative of the total population of 770.
The researcher believes that with 95% level of confidence and 5% margin of error, 192
respondents will be selected from audited taxpayers considered as a representative sample size of
the population for quantitative data gathering. Then the required sample units from each
categories of taxpayers will selected through probability proportion to size as presented in table
3.1.Accordingly, 114 and 78 numbers of taxpayers are selected from category A and category B
taxpayers who reports for head office as well as sub cities respectively. Moreover about 16 tax
auditors and 24 management staff members in Assela town tax administration authority are
selected through purposive sampling technique.

Table 3.: Sample Size

Respondents Total number of taxpayers Sample size
Total Sub cities Head Number Percentage
office

Category A 459 459 114 60%

Category B 311 311 78 40%
Total audited 770 311 459 192 100%
taxpayers
Total Managements 24 14 10 24 100%
Total Auditors 16 10 6 16 100%
Tax authority staffs 40
Total 810 335 475 232

Source: From respective revenue Authority Office report 2019