Question: Using Regression Results to Construct and Apply a Cost Formula McGarvey Manufacturing Company had the following 12 months of data on purchasing cost and number

Using Regression Results to Construct and Apply a Cost Formula McGarvey

Using Regression Results to Construct and Apply a Cost Formula McGarvey Manufacturing Company had the following 12 months of data on purchasing cost and number of purchase orders. The controller for McGarvey Manufacturing ran regression on the data, and the coefficients shown by the regression program are: Intercept 15,676 (rounded to the nearest dollar) X variable 18.03 (rounded to the nearest cent) Required: 1. Construct the cost formula for the purchasing activity showing the fixed cost and the variable rate. Total purchasing cost =$+($Purchaseorders)

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