Analysts for Brazil Brewery have selected the following cost drivers: volume of beer produced (in hectoliters, i.e., 1 hL = 100 L), total amount of raw materials used (in kilograms), number of batches, volume of water used (in hL), number of cleaning procedures performed€”cleanings in place (CIPs)€”and number of new products. Here are the cost data and levels of cost driver activity for 18 months.

Required:
a. Using multiple regression, find the cost driver rates for each of the cost drivers.
b. Assuming the following level of cost driver volume for the next month, what is the estimated cost? (Don€™t forget to include the intercept of the regression in your estimate.)
1,650................................... hL of beer produced
25,500................................. kg of raw materials consumed
100...................................... Batches
10,800................................. hL of water consumed
120...................................... CIPs
1.......................................... New product
c. Brazil Brewery is considering a target for water consumption of 5.0 hL water per hL of beer produced. How much would the company have saved in total over the previous 18 months if it had reached this target in the previous 18months?

Transcribed Image Text:

0100023200001010123 721830627567151590_5 7889101887767888 005 ate $30 002 35 9, 10, 10, 201 7, 19 gaz 59 990 29 005 3-14- 67 2 ,5 ,0 7 5 3 1 2 7 5 5 3 6 1 272551 8 een 89 980 09 2 2 4 5 5 5 5 68 2 3 5 7 59 68 5 3 60 2 9878372 8