Analysis of sales (the independent variable) to cash flows (the dependent variable) data for linear regression produces an intercept of -$124,666 and a slope of 0.1823. Which correctly explains the slope value? If sales rise by one-dollar, net cash flow would increase by 18.23%1823 is multiplied by the current period actual and (1 - 0.1823) is multiplied by the current period forecastIf sales drop by one-dollar, net cash flow would drop by $0.182323% of the change in net cash flow is explained by the change in net sales

The slope indicates the changes in the dependant variable as we move along the dependant line. A…

Answered: Analysis of sales (the independent…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Analysis of sales (the independent variable) to cash flows (the dependent variable) data for linear regression produces an intercept of -$124,666 and a slope of 0.1823. Which correctly explains the slope value?

If sales rise by one-dollar, net cash flow would increase by 18.23%
1823 is multiplied by the current period actual and (1 - 0.1823) is multiplied by the current period forecast
If sales drop by one-dollar, net cash flow would drop by $0.1823
23% of the change in net cash flow is explained by the change in net sales

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