Wallace, Inc., produces a product tha goes through three departments: Machining, Assembly, and Polishing. Materials are added at the beginning of the machining operation; labor and overhead are added uniformly throughout the process. The Machining department had work in process at the beginning and end of 1998 as follows:

The company completed 42,500 units during the year and incurred the folowing manufacturing costs:

The inventory at the beginning of the year was carried at the following costs:

REQUIRED:

Prepare a Cost of Production report using the Weighted Average Method

Video Planet (“VP”) sells a big screen TV package consisting of a 60-inch plasma TV, a universal remote, and on-site installation by VP staff. The installation includes programming the remote to have the TV interface with other parts of the customer’s home entertainment system. VP concludes that the TV, remote, and installation service are separate performance obligations. VP sells the 60-inch TV separately for $2,295, sells the remote separately for $135, and offers the installation service separately for $270. The entire package sells for $2,600. Required: How much revenue would be allocated to the TV, the remote, and the installation service?

Concur Technologies, Inc., is a large expense-management company located in Redmond, Washington.  The Wall Street Journal asked Concur to examine the data from 8.3 million expense reports to provide insights regarding business travel expenses. Their analysis of the data showed that New York was the most expensive city, with an average daily hotel room rate of $198 and an average amount spent on entertainment, including group meals and tickets for shows, sports, and other events, of $172. In comparison, the U.S. averages for these two categories were $89 for the room rate and $99 for entertainment. The table in the Excel Online file below shows the average daily hotel room rate and the amount spent on entertainment for a random sample of 9 of the 25 most visited U.S. cities (The Wall Street Journal, August 18, 2011). Construct a spreadsheet to answer the following questions.

1. Develop the least squares estimated regression equation.

   Entertainment = (___)+(___) Room Rate ( to 4 decimals)

2. Provide an interpretation for the slope of the estimated regression equation (to 3 decimals).

   The slope of the estimated regression line is approximately (____) . So, for every dollar increase in the hotel room rate the amount spent on entertainment increases by $ (___).

3. The average room rate in Chicago is $128, considerably higher than the U.S. average. Predict the entertainment expense per day for Chicago (to whole number).

   $ (___)
   
   

   Hotel Room Rate ($)	Entertainment ($)
   152	162
   96	104
   87	103
   113	141
   92	98
   103	121
   133	167
   88	140
   81	96

Concur Technologies, Inc., is a large expense-management company located in Redmond, Washington. The Wall Street Journal asked Concur to examine the data from 8.3 million expense reports to provide insights regarding business travel expenses. Their analysis of the data showed that New York was the most expensive city, with an average daily hotel room rate of $198 and an average amount spent on entertainment, including group meals and tickets for shows, sports, and other events, of $172. In comparison, the U.S. averages for these two categories were $89 for the room rate and $99 for entertainment. The table in the Excel Online file below shows the average daily hotel room rate and the amount spent on entertainment for a random sample of 9 of the 25 most visited U.S. cities (The Wall Street Journal, August 18, 2011). Construct a spreadsheet to answer the following questions.

1. What does the scatter diagram developed in part (a) indicate about the relationship between the two variables?

   The scatter diagram indicates a _________ linear relationship between the hotel room rate and the amount spent on entertainment.

2. Develop the least squares estimated regression equation.

   Entertainment=______+_________ room rate (to 4 decimals)

3. Provide an interpretation for the slope of the estimated regression equation (to 3 decimals).

   The slope of the estimated regression line is approximately . So, for every dollar _________ in the hotel room rate the amount spent on entertainment increases by $.

4. The average room rate in Chicago is $128, considerably higher than the U.S. average. Predict the entertainment expense per day for Chicago (to whole number).

   $

Serial Case

1. C6-72Calculate and compare cost estimates using high-low and regression methods (Learning Objectives 4 & 5)

This case is a continuation of the Caesars Entertainment Corporation serial case that began in Chapter 1. Refer to the introductory story in Chapter 1, here for additional background. (The components of the Caesars serial case can be completed in any order.)

Caesar Entertainment Corporation’s Form 10-K contains a variety of data in addition to financial statements. Below is a list that contains Caesars’ food and beverage costs (adapted) taken from its Statements of Operations for the past 22 years. In addition, the number of hotel rooms and suites owned by Caesars at the end of each of those 22 years has been gathered from other information provided in the Form 10-Ks.

Requirements (use excel)

1. Using the high-low method, find the following cost estimates:
   1. Variable food and beverage cost per hotel room/suite
   2. Fixed food and beverage cost per hotel room/suite
2. Perform a regression analysis using Excel. Use # of hotel rooms & suites as the X and the Food and beverage costs as the Y in your regression analysis.
   1. What is the estimated variable food and beverage cost per hotel room/suite?
   2. What is the estimated fixed food and beverage cost per hotel room/suite?
   3. In your opinion, is the number of hotel rooms and suites a good predictor of Caesars’ food and beverage costs? Why or why not?

Austin Clemens is writing a report for his high school environmental science class about the city’s climate. To impress his teacher, Austin would like to show evidence that the population mean daily low temperature during the five-year period from 1998–2002 is less than the population mean daily low temperature during the five-year period from 2013–2017. He researches the claim using a website that records all of the weather data observed at a local airport. After conducting the research, Austin assumes that the population standard deviation is 10.48∘F for 1998–2002 and 11.29∘F for 2013–2017. Due to the large amount of data in each five-year period, Austin randomly selects the daily low temperatures for each group. The sample statistics are shown in the table below. Let μ1 be the population mean daily low temperature during the five-year period from 1998–2002 and μ2 be the population mean daily low temperature during the five-year period from 2013–2017. The p-value rounded to three decimal places is 0.192, the significance level is α=0.10, the null hypothesis is H0:μ1−μ2=0, and the alternative hypothesis is Ha:μ1−μ2<0.

1998–2002 2013–2017 x

x=44.31∘F x2=46.02

n=59 n=63

Which of the following statements are accurate for this hypothesis test to evaluate the claim that the difference between the population mean daily low temperature during the five-year period from 1998–2002 and the population mean daily low temperature during the five-year period from 2013-2017 is less than zero? Select all that apply:

A)Reject the null hypothesis that the true difference between the population mean daily low temperature during the five-year period from 1998–2002 and the population mean daily low temperature during the five-year period from 2013-2017 is equal to zero.

B)Fail to reject the null hypothesis that the true difference between the population mean daily low temperature during the five-year period from 1998–2002 and the population mean daily low temperature during the five-year period from 2013-2017 is equal to zero.

C)Based on the results of the hypothesis test, there is not enough evidence at the α=0.10 level of significance to suggest that the true difference between the population mean daily low temperature during the five-year period from 1998–2002 and the population mean daily low temperature during the five-year period from 2013-2017 is less than zero.

D)Based on the results of the hypothesis test, there is enough evidence at the α=0.10 level of significance to suggest that the true difference between the population mean daily low temperature during the five-year period from 1998–2002 and the population mean daily low temperature during the five-year period from 2013-2017 is less than zero.

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Question 7 of 10

Exercise 12.39

Describe in as much detail as possible, the recovery process of the Russia Financial Crisis of 1998.