Question: The following data relates the machine hours incurred in the production process. The company is considering machine hours to estimate manufacturing costs. Variable Constant

The following data relates the machine hours incurred in the production process.

The following data relates the machine hours incurred in the production process. The company is considering machine hours to estimate manufacturing costs. Variable Constant Independent variable 230 r2 = 0.82 y Standard Error 82.73 105.50 Coefficient 115 t-Value 1.39 not 2.18 a. What is the cost estimation equation using the data above? b. What is the estimated cost of producing 500 units? c. Is machine hours reliable in estimating manufacturing costs in this exampfe? Why or why not - give one reason based on the statistical data provided in the table above.

Step by Step Solution

★★★★★

3.38 Rating (164 Votes )

There are 3 Steps involved in it

1 Expert Approved Answer

Step: 1 Unlock

From the given output the coefficient for con... View full answer

Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock

Step: 3 Unlock

Students Have Also Explored These Related Accounting Questions!

The following data relates to the Density Company's first operating period. Calculate cost of ending inventory for each product. Overhead Rate (Percent Cost/Unit Units Ending of Direct Labor Cost)...

The management of Biggs Company is considering a proposal to install a third production department within its existing factory building. With the companys present production setup, 200,000 pounds per...

The Western Canada Communications Company is considering a bid to provide long-distance phone service. You are asked to conduct a poll to estimate the percentage of consumers who are satisfied with...

You will assume that you still work as a financial analyst for AirJet Best Parts, Inc. The company is considering a capital investment in a new machine and you are in charge of making a...

Chrome-It, Inc., manufactures special chromed parts made to the order and specifications of the customer. It has two production departments, stamping and plating, and two service departments, power...

Multiple Choice Questions 1. A plan that states the number of units to be manufactured during each future period covered by the budget, based on the budgeted sales for the period and the levels of...

Percival Products manufactures its products in two separate departments: Machining and Assembly. Total manufacturing overhead costs for the year are budgeted at $ 1,090,000. Of this amount, the...

Project Evaluation this is a comprehensive project evaluation problem bringing together much of what you have learned in this and previous chapters. Suppose you have been hired as a financial...

Classification of casts, service sector Consumer Focus is a marketing research firm that organizes focus groups for consumer-product companies. Each focus group has eight individuals who are paid $50...

Cost distortions, original activity-based costs At its manufacturing plant in Duluth, Minnesota, Endo Electronics Company manufactures two products, X21 and Y37. For many years, the company has used...

Lucy decides that it is time that she and Schroeder marry. As an inducement, Lucy promises to buy Schroeder a new piano if he will marry her. He agrees. She also tells him that she wants a prenuptial...

Quality Hardwoods Company distributes hardwood products to small furniture manufacturers. The adjusted trial balance data given below is from the firms worksheet for the year ended December 31, 2016....

The output X will have a value of 1 if any of the following combination of conditions occurs: either rotation speed >= 1000 rpm and tilt angle rotation speed = 150mW tilt angle > - 30 deg and...

Richard Brandon's, Virgin hotels group has a policy that half of all management positions must be filled by women. Do you agree or disagree with this kind of policy? Why

In Type 1 diabetes, the body stops making insulin because a person's own immune system mistakenly attacks and destroys the cells that make this hormone. Which cells are destroyed in Type 1 diabetes?...

The Boom-Box Corporation produces high end speakers for commercial use. They make 3 different models. Under their old cost system, Tele-Vision allocated overhead costs based on direct labor dollars....

Please give me the answer as soon as possible. Thank you. Will give you a positive rating without hesitance. The following data relates to questions 1 and 2 The following information relates to a...

The accounting department of MNO Limited (MNO) provides two sets of data for June. The first data relates to the purchase, and the second data relates to the sales. Table 1. The First Set of Data -...

1) Of the five criteria for a finance lease, which one is not applied if the lease begins "at or near the end of the economic life of the underlying asset? A) A purchase option is reasonably certain...