Least Squares Method (Appendix). Refer to Exhibit 2-5. a. Using the number of deliveries as the activity,

Question:

Least Squares Method (Appendix). Refer to Exhibit 2-5.

a. Using the number of deliveries as the activity, use the least squares method to determine the fixed and variable elements of total repairs and maintenance expense. (Round the variable rate to the nearest tenth of a cent.)

b. Why does your answer differ from that obtained in the Appendix, where number of miles was used as the activity? Which answer do you think is more reliable? Why?

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