NASA fixed and how much is variable. The following data are the only reconds available behavior...

Transcribed Image Text:

NASA fixed and how much is variable. The following data are the only reconds available behavior of manufacturing overhead costs. Specifically, he wants to know how much overhead cost is Patrick Ross, the president of M&M Materials Company, has asked for information about the cost PROBLEM 1 (14%) (PARTA) Month February March April May June Machine hours (1,870) 3,080 1,200 Overhead Costs $22,500 (24,475) 24,321 2,750 3,700 Required: Using the high-low method, determine the MONTHLY overhead cost equation. (Use machine-hours as your cost driver.) (6%) 21,650 31,196 PROBLEM 1 (PART B) On January 1 2020, South by Southwest Company used least squares regression analysis to estimate the total monthly payroll department cost of the company in 2020. The followings are the output from the regression analysis based on the observation of the payroll department cost( dependent variable) and the labor hours worked (independent variable) for the last 20 months: Constant r2 X coefficient(s) $18,000 0.8924 ($ 2.55) Required: BASED ON THE OUTPUT FROM THE REGRESSION ANALYSIS a. What is the total estimated fixed payroll department cost? (2%) b. What is the variable payroll department cost per labor hour? (2%) c. What is the estimate cost function of the payroll department cost? (2%) d. What is the coefficient of determination? Comment on the goodness of fit of the cost function? (2%) NASA fixed and how much is variable. The following data are the only reconds available behavior of manufacturing overhead costs. Specifically, he wants to know how much overhead cost is Patrick Ross, the president of M&M Materials Company, has asked for information about the cost PROBLEM 1 (14%) (PARTA) Month February March April May June Machine hours (1,870) 3,080 1,200 Overhead Costs $22,500 (24,475) 24,321 2,750 3,700 Required: Using the high-low method, determine the MONTHLY overhead cost equation. (Use machine-hours as your cost driver.) (6%) 21,650 31,196 PROBLEM 1 (PART B) On January 1 2020, South by Southwest Company used least squares regression analysis to estimate the total monthly payroll department cost of the company in 2020. The followings are the output from the regression analysis based on the observation of the payroll department cost( dependent variable) and the labor hours worked (independent variable) for the last 20 months: Constant r2 X coefficient(s) $18,000 0.8924 ($ 2.55) Required: BASED ON THE OUTPUT FROM THE REGRESSION ANALYSIS a. What is the total estimated fixed payroll department cost? (2%) b. What is the variable payroll department cost per labor hour? (2%) c. What is the estimate cost function of the payroll department cost? (2%) d. What is the coefficient of determination? Comment on the goodness of fit of the cost function? (2%)