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 estimatedregression equation relating volume and cost, an accountant can estimate the cost associated with a particular manufacturing volume. Consider the following sample of production volumes andtotal cost data for a manufacturing operation.Total Cost($)390047005300570064007100The data on the production volume and total cost y for particular manufacturing operation were used to develop the estimated regression equation =-490.00 + 10.60x,a. The company's production schedule shows that 450 units must be produced next month. Predict the total cost for next month.ŷ* =* (to 2 decimals)b. Develop a 99% prediction interval for the total cost for next month.(to 2decimals)8t-value decimals)(to 3* (to 2Spred decimals)Prediction Interval for an individual Value next monthⓇProduction Volume(units)400500550600650700) (to whole number)c. If an accounting cost report at the end of next month shows that the actual production cost during the month was $6,000, should managers be concerned about incurring such a high totalcost for the month? Discuss.Based on one month, $6,000 is not✔ outside the upper limit of the prediction interval. A sequence of five to seven months with consistently high costs should causeconcern.

Confidence interval determine the range where the true value of parameter lies. Prediction interval…

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

Section: Chapter Questions

Problem 1P

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HP-See What's Hot D D HP Games Web Slice Gallery bo Pokemon Best Wis... MINDTAP Q Search this course 8 X 15 Assignment 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) 400 Σ 450 550 600 700 750 Compute bi and bo (to 1 decimal). Do not round intermediate calculations. b₁ Apple Yahoo! a. Use these data to develop an estimated regression equation that could be used to predict the total cost for a given production volume. Do not round intermediate calculations. Google Maps Total Cost ($) 4,300 5,300 5,700 6,200 6,700 7,300 Complete the estimated regression equation (to 1 decimal) Do not round…
An important application of regression analysis in accounting is in the estimation of cost. By collecting data on volume and cost and using the least squares method to develop an estimated regression equation relating volume and cost, an accountant can estimate the cost associated with a particular manufacturing volume. Consider the following sample of production volumes and total cost data for a manufacturing operation. Production Volume (units) Total Cost ($) 400 3,700 450 4,700 550 5,100 600 5,600 700 6,100 750 6,700 a. Use these data to develop an estimated regression equation that could be used to predict the total cost for a given production volume. Do not round intermediate calculations. Compute bị and bo (to 1 decimal). Do not round intermediate calculations. b1 bo Complete the estimated regression equation (to 1 decimal). Do not round intermediate calculations. ŷ = + b. What is the variable cost per unit produced (to 2 decimal)? Do not round intermediate calculations. $ c.…
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 ($) 400 3,800 450 4,800 550 5,200 600 5,700 700 6,200 750 6,800 a. Compute b1 and bo (to 1 decimal). b1 bo Complete the estimated regression equation (to 1 decimal). + b. What is the variable cost per unit produced (to 1 decimal)? c. Compute the coefficient of determination (to 3 decimals). Note: report r between 0 and 1. What percentage of the variation in total cost can be explained by the production volume (to 1 decimal)? d. The company's production schedule shows 500 units must be produced next month. What is the estimated total…
Report the equation of the regression line and interpret it in the context of the problem
An important application of regression analysis in accounting is in the estimation of cost. By collecting data on volume and cost and using the least squares method to develop an estimated regression equation relating volume and cost, an accountant can estimate the cost associated with a particular manufacturing volume. Consider the following sample of production volumes O and total cost data for a manufacturing operation. O Production Volume (units) Total Cost ($) 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 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 ($) 400 4,300 450 5,300 550 5,700 600 6,200 700 6,700 750 7,300 Compute b1 and b0 (to 1 decimal). Complete the estimated regression equation (to 1 decimal) y^ = ____ + ____x What is the variable cost per unit produced (to 1 decimal)?
An important application of regression analysis is in the estimation of cost. By collecting data on volume and cost and using the least squares method to develop an estimated regression equation relating volume and cost, one can estimate the cost associated with a particular manufacturing volume. Consider the following sample of monthly production volumes and total costs data for a manufacturing operation for the year 2018. Month Production Volume (units) Total Costs ($) January 2018 February 2018 500 6,000 350 4,000 March 2018 450 5,000 April 2018 550 5,400 May 2018 600 5,900 June 2018 400 4,000 July 2018 August 2018 September 2018 400 4,200 350 3,900 400 4,300 October 2018 600 6,000 November 2018 700 6,400 December 2018 750 7,000 Which of the following is NOT necessarily true about the interpretation of the value of b in the simple linear regression equation y = a + bx for this problem? * I. The monthly total costs will increase by $7.6437 for every one-unit increase in the…
An important application of regression analysis in accounting is in the estimation of cost. By collecting data on volume and cost and using the least squares method to develop an estimated regression equation relating volume and cost, an accountant can estimate the cost associated with a particular manufacturing volume. Consider the following sample of production volumes and total cost data for a manufacturing operation. Production Volume (units) Total Cost ($) 400 4,700 450 5,700 550 6,100 600 6,600 700 7,100 750 7,700 A) Compute b1 and b0 (to 1 decimal)b1 b0 Complete the estimated regression equation (to 1 decimal). = + x B) What is the variable cost per unit produced (to 1 decimal)?$ C) Compute the coefficient of determination (to 3 decimals). Note: report r2 between 0 and 1.r2 = What percentage of the variation in total cost can be explained by the production volume (to 1 decimal)? % D) The company's production schedule shows 500 units must be produced next…
The total stopping distance (in feet) was measured for a midsize four-door sedan driving in dry conditions at various speeds. The resulting data are presented in the table below. Speed (in mph) 10 20 30 40 50 60 70 80 Total Stopping Distance 27 61 104 168 235 297 386 473 (a) Determine the linear regression model that will best predict the total stopping distance for a midsize four-door sedan driving dry conditions based on the speed of the vehicle. (b) How well does the linear regression model fit this sampe data? (c) Predict the total stopping distance for a midsize four-door sedan driving at a speed of 65 mph in dry conditions. Please no excel. I like seeing the work done so I can understand what I am doing.

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