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 regressionequation 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 amanufacturing operation.Production Volume (units)Total Cost ($)400400045050005505400590060070064007000750a. Compute bị and bo (to 2 decimals if necessary).bịboComplete the estimated regression equation (to 2 decimals if necessary).хb. What is the variable cost per unit produced (to 1 decimal)?c. Compute the coefficient of determination (to 4 decimals). Note: report r between 0 and 1.=What percentage of the variation in total cost can be explained by the production volume (to 2 decimals)?d. The company's production schedule shows 500 units must be produced next month. What is the estimated total cost for this operation (to 2 decimals)?

a.Let X be the production volume and Y be the total costFrom the given data

Answered: An important application of regression…

MATLAB: An Introduction with Applications

6th Edition

ISBN:9781119256830

Author:Amos Gilat

Publisher:Amos Gilat

Chapter1: Starting With Matlab

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1. Based on the given data, find the estimated regression equation using least square methods.
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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 O and total cost data for a manufacturing operation. O Production Volume (units) Total Cost ($) 400 4100 450 4600 500 5600 600 6400 700 7400 750 8400 N The data on the production volume and total cost y for particular manufacturing operation were used to develop the estimated regression equation ŷ = -524.58+11.66z. a. The company's production schedule shows that 550 units must be produced next month. Predict the total cost for next month. ŷ* = (to 2 decimals) b. Develop a 98% prediction interval for the total cost for next month. X (to 2 decimals) 8 t-value (to 3 decimals) 8pred (to 2 decimals) Prediction Interval for…
An article gave a scatter plot along with the least squares line of x = rainfall volume (m3) and y = runoff volume (m3) for a particular location. The accompanying values were read from the plot. x 6 12 14 20 23 30 40 50 55 67 72 79 96 112 127 y 4 10 13 15 15 25 27 46 38 46 53 74 82 99 104 (a) Does a scatter plot of the data support the use of the simple linear regression model? Yes, the scatterplot shows a reasonable linear relationship.Yes, the scatterplot shows a random scattering with no pattern. No, the scatterplot shows a reasonable linear relationship.No, the scatterplot shows a random scattering with no pattern. (b) Calculate point estimates of the slope and intercept of the population regression line. (Round your answers to four decimal places.) slope intercept (c) Calculate a point estimate of the true average runoff volume when rainfall volume is 50. (Round your answer to four decimal places.) m3(d) Calculate a point estimate of the…
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