An important application of regression analysis in accounting is
in the estimation of cost. By collecting data on volume and cost
and using the least squares method to develop an estimated
regression equation relating volume and cost, an accountant can
estimate the cost associated with a particular manufacturing
volume. Consider the following sample of production volumes and
total cost data for a manufacturing operation.
| Production Volume (units) | Total Cost ($) |
| 400 | 4,400 |
| 450 | 5,400 |
| 550 | 5,800 |
| 600 | 6,300 |
| 700 | 6,800 |
| 750 | 7,400 |
In: Statistics and Probability
An important application of regression analysis in accounting is in the estimation of cost. By collecting data on volume and cost and using the least squares method to develop an estimated regression equation relating volume and cost, an accountant can estimate the cost associated with a particular manufacturing volume. Consider the following sample of production volumes and total cost data for a manufacturing operation.
| Production Volume (units) | Total Cost ($) |
| 400 | 4,000 |
| 450 | 5,000 |
| 550 | 5,400 |
| 600 | 5,900 |
| 700 | 6,400 |
| 750 | 7,000 |
b1=
b0=
y1= _____ + ______x
b. What is the variable cost per unit?
r2=
What percentage of the variation in total cost can be explained by the production volume?
The company's production schedule shows 500 units must be produced next month. What is the estimated total cost for this operation (to the nearest whole number
In: Statistics and Probability
Q4. Discuss the various reports provided by cost accounting department.
In: Accounting
Cost behavior is the term used to summarize the impact of costs that are influenced by volume. On a financial statement, these costs are identified as variable costs. Understanding the role of both fixed and variable costs in a health care organization is key to targeting profitability centers.
Assume the role of a financial consultant. You have been hired by a small non-profit hospital, struggling with profitability. You have been given full access to all financial and operational information to perform your research and analysis.
In: Finance
People in the aerospace industry believe the cost of a space project is a function of the mass of the major object being sent into space. Use the following data to develop a regression model to predict the cost of a space project by the mass of the space object. Determine r2 and se.
Weight (tons)
1.897
3.019
0.453
0.965
1.058
2.100
2.379
Cost ($ millions)
$53.6
184.9
6.4
23.5
34.2
110.4
104.6
*(Do not round the intermediate values. Round your answers to 4 decimal places.)
**(Round the intermediate values to 4 decimal places. Round your answer to 3 decimal places.)
ลท = enter a number rounded to 4 decimal places * + enter a number rounded to 4 decimal places * x
r2 = enter a number rounded to 3 decimal places **
se = enter a number rounded to 3 decimal places **
In: Statistics and Probability
1. Which of the following would be considered an appraisal cost of quality?
A) Training workers to perform their jobs
B) Redesigning products
C) Salaries of inspectors
D) Repairing an item under the warranty
E) None of the above
2. All new preseription medicines can be marketed in the U.S. only after getting
approval from the FDA after:
A) Successfully completing phase I clinical trials
B) Successfully completing phase III clinical trials
C) Advertised to the public
D) Advertised to prescribers
3. For a patent to benefit from legal protection it must satisfy all requirements
except:
A) New
B) Not obvious
C) Useful
D) Provide competitive advantage
4. In healthcare, quality of care can be estimated using:
A) Customer satisfaction
B) Valuc
C) Conformance to design
D) Outcomes
E) None of the above
5. Which of the following is NOT an example of command and control regulation?
A) pollution reduction quotas
B) prison sentence for polluters
C) pollution performance based on technology
D) emission trading
E) control through permits
In: Operations Management
Which of the following is an example of a period cost in a company that makes clothing?
Select one:
a. Advertising cost for a new line of clothing,
b. Factory supervisor's salary
c. Fabric used to produce men's pants,
d. Monthly depreciation on production equipment,
In: Accounting
A firm is producing 1,000 units of a good and the total cost of production is $4 million. $1
million in costs go to fixed factors like buildings, insurances, and operating licenses. The
remaining $3 million goes to workers and suppliers.
a) Using the numbers provided, calculate the average total cost, the average fixed cost, and
the average variable cost?
b) Explain what is meant by marginal cost?
c) If the marginal cost for the firm of producing 1,000 units is $2,500, what has been
happening to the average variable cost? Has it been increasing, decreasing, or staying the
same?
In: Economics
What is the opportunity cost of government spending on servicing the interest on the debt.
In: Economics
Using the information below, calculate the cost of goods
manufactured for the period:
| Beginning Raw Materials Inventory | $ | 26,000 | |
| Ending Raw Materials Inventory | 31,000 | ||
| Beginning Work in Process Inventory | 56,000 | ||
| Ending Work in Process Inventory | 65,000 | ||
| Beginning Finished Goods Inventory | 81,500 | ||
| Ending Finished Goods Inventory | 68,000 | ||
| Cost of Goods Sold for the period | 541,000 | ||
| Sales revenues for the period | 1,255,000 | ||
| Operating expenses for the period | 233,000 | ||
In: Accounting