Question

Burmer Co. has accumulated data to use in preparing its annual
profit plan for the upcoming year. The cost behavior pattern of the
maintenance costs must be determined. Data regarding the machine
hours and maintenance costs for the last year and the results of
the regression analysis are as follows:

Month | Maintenance Cost | Machine Hours | ||||

Jan. | $ | 5,040 | 620 | |||

Feb. | 3,600 | 420 | ||||

Mar. | 4,320 | 520 | ||||

Apr. | 3,380 | 390 | ||||

May | 5,220 | 650 | ||||

June | 3,550 | 400 | ||||

July | 3,640 | 430 | ||||

Aug. | 5,360 | 680 | ||||

Sept. | 5,110 | 640 | ||||

Oct. | 4,860 | 610 | ||||

Nov. | 3,960 | 460 | ||||

Dec. | 3,790 | 440 | ||||

Sum | $ | 51,830 | 6,260 | |||

Average | $ | 4,319 | 522 | |||

A staff assistant has run regression analyses on the data and
obtained the following output using Excel:

REGRESSION ANALYSIS

Y (Dependent) Variable: Maintenance Cost

X (Independent) Variable: Maintenance Hours

Regression Statistics |
|||||||||||

Multiple R | 0.998210294 | ||||||||||

R Square | 0.996423791 | ||||||||||

Adjusted R Square | 0.99606617 | ||||||||||

Standard Error | 47.0629563 | ||||||||||

Observations | 12 | ||||||||||

ANOVA | |||||||||||

df |
SS |
MS |
F |
Significance F |
|||||||

Regression | 1 | 6171342.448 | 6171342 | 2786.257 | 1.44166E-13 | ||||||

Residual | 10 | 22149.21856 | 2214.922 | ||||||||

Total | 11 | 6193491.667 | |||||||||

Coefficients |
Standard Error |
t Stat |
P-value |
Lower 95% |
Upper 95% |
||||||

Intercept | 783.7782188 | 68.34114772 | 11.46861 | 4.47E-07 | 631.504653 | 936.051785 | |||||

Hours | 6.777102456 | 0.12839066 | 52.78501 | 1.44E-13 | 6.491030239 | 7.06317467 | |||||

The statistic that indicates precision of the regression is:

Answer #1

Burmer Co. has accumulated data to use in preparing its annual
profit plan for the upcoming year. The cost behavior pattern of the
maintenance costs must be determined. Data regarding the machine
hours and maintenance costs for the last year and the results of
the regression analysis are as follows:
Month
Maintenance Cost
Machine Hours
Jan.
$
5,040
620
Feb.
3,600
420
Mar.
4,320
520
Apr.
3,380
390
May
5,220
650
June
3,550
400
July
3,640
430
Aug.
5,360
680...

Item14
Item14
Item 14
Burmer Co. has accumulated data to use in preparing its annual
profit plan for the upcoming year. The cost behavior pattern of the
maintenance costs must be determined. Data regarding the machine
hours and maintenance costs for the last year and the results of
the regression analysis are as follows:
Month
Maintenance Cost
Machine Hours
Jan.
$
5,040
620
Feb.
3,600
420
Mar.
4,320
520
Apr.
3,380
390
May
5,220
650
June
3,550
400
July
3,640...

Bay Co. has accumulated data to use in preparing its annual
profit plan for the upcoming year. The cost behavior pattern of the
maintenance costs must be determined. Data regarding the machine
hours and maintenance costs for the last year are as follows:
Month
Maintenance Cost ($)
Machine Hours
Jan.
5040
620
Feb.
3600
420
Mar.
4320
520
Apr.
3380
390
May
5220
650
June
3550
400
July
3640
430
Aug.
5360
680
Sept.
5110
640
Oct.
4860
610
Nov....

Midgett Co. has accumulated data to use in preparing its annual
profit plan for the upcoming year. The cost behavior pattern of the
maintenance costs must be determined. The accounting staff
suggested that linear regression be employed to derive an equation
for maintenance hours and costs. Data regarding the maintenance
hours and costs for the last year and the results of the regression
analysis are as follows:
Month
Maintenance
Cost
Machine Hours
Jan.
$
5,010
550
Feb.
3,654
390
Mar....

Armer Company is accumulating data to use in preparing its
annual profit plan for the coming year. The cost behavior pattern
of the maintenance costs must be determined. The accounting staff
has suggested the use of linear regression to derive an equation
for maintenance hours and costs. Data regarding the maintenance
hours and costs for the last year and the results of the regression
analysis follow:
Month
Maintenance Cost
Machine Hours
Jan.
$
4,750
700
Feb.
3,550
540
Mar.
4,150...

Armer Company is accumulating data to use in preparing its
annual profit plan for the coming year. The cost behavior pattern
of the maintenance costs must be determined. The accounting staff
has suggested the use of linear regression to derive an equation
for maintenance hours and costs. Data regarding the maintenance
hours and costs for the last year and the results of the regression
analysis follow:
Month
Maintenance Cost
Machine Hours
Jan.
$
4,800
720
Feb.
3,600
560
Mar.
4,200...

Armer Company is accumulating data to use in preparing its
annual profit plan for the coming year. The cost behavior pattern
of the maintenance costs must be determined. The accounting staff
has suggested the use of linear regression to derive an equation
for maintenance hours and costs. Data regarding the maintenance
hours and costs for the last year and the results of the regression
analysis follow:
Month
Maintenance Cost
Machine Hours
Jan.
$
4,950
780
Feb.
3,750
620
Mar.
4,350...

Armer Company is accumulating data to use in preparing its
annual profit plan for the coming year. The cost behavior pattern
of the maintenance costs must be determined. The accounting staff
has suggested the use of linear regression to derive an equation
for maintenance hours and costs. Data regarding the maintenance
hours and costs for the last year and the results of the regression
analysis follow:
Month
Maintenance Cost
Machine Hours
Jan.
$
5,150
860
Feb.
3,950
700
Mar.
4,550...

Armer Company is accumulating data to use in preparing its
annual profit plan for the coming year. The cost behavior pattern
of the maintenance costs must be determined. The accounting staff
has suggested the use of linear regression to derive an equation
for maintenance hours and costs. Data regarding the maintenance
hours and costs for the last year and the results of the regression
analysis follow:
Month
Maintenance Cost
Machine Hours
Jan.
$
4,200
480
Feb.
3,000
320
Mar.
3,600...

The Armer Company is accumulating data to be used in preparing
its annual profit plan for the coming year. The cost behavior
pattern of the maintenance costs must be determined. The accounting
staff has suggested that linear regression be employed to derive an
equation in the form of y = a + bx for maintenance costs. Data
regarding the maintenance hours and costs for last year and the
results of the regression analysis are as follows: Hours of
Activity Maintenance...

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