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- The Connors Company has assembled the following data pertaining to certain costs that cannot beeasily identified as either fixed or variable. Connors Company has heard about a method of measuringcost functions called the high-low method and has decided to use it in this situation.A company has heard about a method of measuring cost functions called the regression analysis and hasdecided to use it in this situation.Cost Hours$23,000 5,000$26,000 6,450$34,600 7,650$42,000 10,000$38,000 9,350What is the estimated total cost at an operating level of 9,000 hours?A) $34,200B) $38,200C) $41,400D) $37,800 Work question #7 using regression analysisMethod of Least Squares, Predicting Cost for Different Time Periods from the One Used to Develop a Cost Formula Refer to the information for Farnsworth Company on the previous page. However, assume that Tracy has used the method of least squares on the receiving data and has gotten the following results: Required: 1. Using the results from the method of least squares, prepare a cost formula for the receiving activity. 2. Using the formula from Requirement 1, what is the predicted cost of receiving for a month in which 1,450 receiving orders are processed? (Note: Round your answer to the nearest dollar.) 3. Prepare a cost formula for the receiving activity for a quarter. Based on this formula, what is the predicted cost of receiving for a quarter in which 4,650 receiving orders are anticipated? Prepare a cost formula for the receiving activity for a year. Based on this formula, what is the predicted cost of receiving for a year in which 18,000 receiving orders are anticipated?Scattergraph method Using the data in P4-2 and a piece of graph paper: 1. Plot the data points on the graph and draw a line by visual inspection, indicating the trend shown by the data points. 2. Determine the variable cost per unit and the total fixed cost from the information on the graph. 3. Determine the variable cost to be charged to the product for the year. 4. Determine the fixed cost to be charged to factory overhead for the year. 5. Do these answers agree with the answers to P4-2? Why or why not?
- Acme Inc. has the following information available: A. Compute the material price and quantity, and the labor rate and efficiency variances. B. Describe the possible causes for this combination of favorable and unfavorable variances.Felix & Company reports the following information. Period Units Produced Total Costs 1 0 $2,595 2 400 3,235 3 800 3,875 4 1,200 4,515 5 1,600 5,155 6 2,000 5,795 7 2,400 6,435 8 2,800 7,075 9 3,200 7,715 10 3,600 8,355 Use spreadsheet software to use ordinary least-squares regression to estimate the cost equation, including fixed and variable cost amounts.The following activity and cost data that were provided by Hoist Corporation would help in estimating its future maintenance costs: Units Maintenance cost P1,350 7 P1,590 11 P1,920 15 P2,100 Using the least squares regression method to estimates the cost formula, the expected total cost for an activity level of 10 units would be closest to:
- Almed Products has determined that the number of machine hours worked (MH) drives the amount of manufacturing overhead incurred (MOH). On the basis of this relationship, a staff analyst has constructed the following regression equation: MOH = 240,000 + 8MH Which of the choices correctly depicts the nature of Almed’s variables? Dependent Independent A. MOH MOH B. MOH MH C. MH MOH D. MH MH E. 8 240,000 Multiple Choice Choice A Choice B Choice C Choice D Choice EThe Gangwere Company has assembled the following data pertaining to certain costs that cannot be easily identified as either fixed or variable. Gangwere Company has heard about a method of measuring cost functions called the high-low method and has decided to use it in this situation. Month Cost Hours January $44,900 3,500 February 24,400 2,000 March 31,280 2,450 April 36,400 3,000 May 44,160 3,900 June 42,400 3,740How is the cost function stated? Question 12 options: a) y = $3,600 + $10.40X b) y = $10,112 + $8.64X c) y = $26,672 + $1.84X d) y = $21,360 + $10.40The following computer printout was generated, using regression, for use in estimating maintenance costs. Intercept 8300 X Variable 1 37 Multiple R 0.9500 R Square 0.9025 Activity variable machine hours An estimate of maintenance costs at an activity level of 100 machine hours would be:
- 1. You have been provided with the following data regarding shipments and costs for Brighton Boutiques: Number of Shipments Received Cost per Receiving Report $202 185 120 105 70 80 87 115 100 $300 $200 $100 $- 0 142 154 20 162 Required: Plot the data points on a scatter graph, and then using the high-low method, determine the cost function of the line that will connect the high and low points on the graph. Does the cost function appear to be linear in nature? 200 175 Graph Template 40 80 60 Number of Shipments 100 120 140Star, Inc. used Excel to run a least-squares regression analysis, which resulted in the following output: Regression Statistics Multiple R 0.9711 R Square 0.9473 Observations 30 Coefficients Standard Error T Stat P-Value Intercept 175,007 61,607 2.84 0.021 Production (X) 11.14 0.9237 12.06 0.000 How much of the variation in cost is not explained by production? Multiple Choice It is impossible to determine. 5.27% 7.63% 2.89%How much of the $0.24 excess unit cost is traceable to apparent inefficient use of labor time?Note: Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (i.e., zero variance). Input all amounts as positive values. Do not round intermediate calculations. Round your final answers to 2 decimal places.
