Question
on question chapter 5 probl 46P, there is a regression answer, but I was wondering how this was calculated with using what overhead costs and
on question chapter 5 probl 46P, there is a regression answer, but I was wondering how this was calculated with using what overhead costs and deliveries? the question states
Your company provides a variety of delivery services. Management wants to know the volume of a particular delivery that would generate $10,000 per month in operating profits before taxes. The company charges $20 per delivery.
The controllers office has estimated overhead costs at $9,000 per month for fixed costs and $12 per delivery for variable costs. You believe that the company should use regression analysis. Your analysis shows the results to be:
Monthly overhead = $26,501 + $10.70 per delivery
Your estimate was based on the following data:
Month | Overhead Costs | Number of Deliveries |
1 | $142,860 | 11,430 |
2 | $ 151,890 | 12,180 |
3 | $192,600 | 15,660 |
4 | $141,030 | 11,250 |
5 | $203,490 | 12,780 |
6 | $180,630 | 14,730 |
7 | $159,630 | 12,510 |
8 | $183,990 | 15,060 |
9 | $194,430 | 15,450 |
10 | $150,120 | 11,970 |
11 | $154,080 | 12,630 |
12 | $184,800 | 15,300 |
13 | $183,120 | 14,580 |
so the regression results were
Multiple R | 0.9921 |
R Square | 0.9843 |
Adjusted R Square | 0.9827 |
Standard Error | 2635.7 |
Observations | 12 |
| Coefficients |
Intercept | $9776.56 |
Number of deliveries
| $11.69
so what was calculated to get the regression results? |
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started