Logo
Home Study Material Contact Search
AI Chat FREE
  1. mathematics
  2. statistics
  3. an important application of regression analysis in

An important application of regression analysis in accounting is in the estimation of cost. By collecting...

70.2K

Verified Solution

Question

Statistics

An important application of regression analysis in accounting isin the estimation of cost. By collecting data on volume and costand using the least squares method to develop an estimatedregression equation relating volume and cost, an accountant canestimate the cost associated with a particular manufacturingvolume. Consider the following sample of production volumes andtotal cost data for a manufacturing operation.

Production Volume (units) Total Cost ($) 400 4,900 450 5,900 5506,300 600 6,800 700 7,300 750 7,900

Compute b1 and b0 (to 1 decimal).

b1 b0 Complete the estimated regression equation (to 1decimal).y= + x

What is the variable cost per unit produced (to 1 decimal)?$

Compute the coefficient of determination (to 3 decimals).

Note: report r2 between 0 and 1. r2 =

What percentage of the variation in total cost can be explainedby the production volume (to 1 decimal)? %

The company's production schedule shows 500 units must beproduced next month.

What is the estimated total cost for this operation (to thenearest whole number)? $

Answer & Explanation Solved by verified expert
4.4 Ratings (736 Votes)
Solution We can use the excel regression data analysis tool toanswer the given questions The excel output is given belowSUMMARY OUTPUTRegression StatisticsMultiple R09791RSquare09587Adjusted    See Answer
Get Answers to Unlimited Questions

Join us to gain access to millions of questions and expert answers. Enjoy exclusive benefits tailored just for you!

Membership Benefits:
  • Unlimited Question Access with detailed Answers
  • Zin AI - 3 Million Words
  • 10 Dall-E 3 Images
  • 20 Plot Generations
  • Conversation with Dialogue Memory
  • No Ads, Ever!
  • Access to Our Best AI Platform: Flex AI - Your personal assistant for all your inquiries!
Become a Member

Other questions asked by students

Q

Financial ratios are essential to assessing to provide an accurate valuation of a firm. Select a...

Finance
Q

How can you give someone $83 using exactly 7 bills, without using any one dollar...

Basic Math
Q

An application of modeling with differential equations from a particular field, such as Physics,Biology, Business, Chemistry, etc.

Basic Math
Q

Please show steps in the calculation. Please make sure you include checking conditions for using the...

Statistics
Q

8. A Piper Cherokee is flying at 4000 ft standard altitude at 105 mph. The wing...

Mechanical Engineering
Q

calculate two questions and explain plz ...

Accounting
Q

Question 17 The trial halance helow relates to Honestv Commercial Rank as at 21st Decemher...

Accounting
Q

Practice with Adjusting and Reversing Entries On October 1, 2023 XYZ pays $56,000 to...

Accounting
Q

Pebble Beach Corporation had a budget of $250,000 for fixed costs last year. Pebble Beach...

Accounting
Q

The Cheyenne Hotel in Big Sky, Montana, has accumulated records of the total electrical costs...

Accounting
Q

please give the answer correctly. Assume that Google invests $2.42 billion in...

Accounting
Q

Your assignment is as follows: Find an article the showcases an event or natural disaster...

Accounting