The new cost analyst in your accounting department just received a computer-generated report that contains the results of a simple regression analysis. He was estimating the costs of the marketing department using units sold as the cost driver. The summary results of the report are as follows:

REQUIRED

A. Write an equation for the cost function based on the regression analysis.

B. What does the adjusted R-square tell you?

C. What other cost drivers could potentially explain marketing costs? Explain.

Transcribed Image Text:

p-value 0.25 Variable Coefficient t-statistic Intercept Units sold 12.44 1,39 222.35 2.48 0.001 Adjusted R-square = 0.61 %3D