Question
Thane Company is interested in establishing the relationship between electricity costs and machine hours. Data have been collected and a regression analysis prepared using Excel.
Thane Company is interested in establishing the relationship between electricity costs and machine hours. Data have been collected and a regression analysis prepared using Excel. The monthly data and the regression output follow:
| Month | Machine Hours | Electricity Costs | ||
| January | 2,400 | $ | 19,150 | |
| February | 2,800 | $ | 22,500 | |
| March | 1,800 | $ | 14,250 | |
| April | 3,000 | $ | 24,500 | |
| May | 3,700 | $ | 29,000 | |
| June | 3,200 | $ | 23,500 | |
| July | 4,000 | $ | 25,500 | |
| August | 3,400 | $ | 23,500 | |
| September | 1,900 | $ | 17,000 | |
| October | 3,600 | $ | 27,500 | |
| November | 4,600 | $ | 32,500 | |
| December | 4,100 | $ | 28,500 | |
| Summary Output | |
| Regression Statistics | |
| Multiple R | 0.957 |
| R Square | 0.915 |
| Adjusted R2 | 0.907 |
| Standard Error | 1,600.66 |
| Observations | 12.00 |
| Coefficients | Standard Error | t Stat | P-value | Lower 95% | Upper 95% | |
| Intercept | 5,472.38 | 1,836.37 | 2.98 | 0.01 | 1,380.70 | 9,564.07 |
| Machine Hours | 5.76 | 0.55 | 10.40 | 0.00 | 4.52 | 6.99 |
If the controller uses regression analysis to estimate costs, the estimate of the variable portion of electricity costs is:
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Accounting Major By Day Gamer By Night
Authors: Accountant Notes
1st Edition
1687764158, 978-1687764157
