Coefficient of Determination and the Standard Error of the Estimate The ABC Company produces two products, known as A and B. The following predictions have been made for the coming month:

No predictions have yet been made for overhead and for selling and administrative costs, but the company intends to base these predictions on 24 months of observations of the following:

{Required:}
(1) Calculate the coefficient of determination \(\left(r^{2}\right)\) and the standard error of the estimate \(\left(\mathrm{S}_{\text {e }}\right.\) ) for each prediction equation.
(2) Predict the cost range of the total overhead and the total selling and administrative costs for the coming month (assume the desired confidence level is \(95 \%\) ). Select one prediction equation for the overhead cost estimation and state why you selected the equation.

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Selling price per unit.. Direct material cost per unit of production.... Direct labor hours per unit of production.. Machine hours per unit of production: Type 1 machines. Type 2 machines.. Total sales in units. Total production in units Direct labor cost per hour.. Product A B $60 $50 10 12 3 1.5 .0.2 0.5 0.3 0.1 9,000 22,000 10,000 20,000 $8.00