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The College of Business at Northeast College is accumulating data as a first step in the preparation of next year's budget development. One cost that

The College of Business at Northeast College is accumulating data as a first step in the preparation of next year's budget development. One cost that is being looked at closely is administrative costs as a function of student credit hours. Data on administrative costs and credit hours for the past thirteen months are shown below:

Month Administrative Costs Credit Hours
July $ 129,901 850
August 83,093 427
September 225,940 1,704
October 216,634 1,312
November 258,383 1,621
December 185,049 1,424
January 219,617 1,651
February 245,360 1,685
March 209,702 1,376
April 192,045 1,435
May 250,578 1,672
June 170,898 732
July 128,527 627
Total $ 2,515,727 16,516
Average $ 193,517 1,270

The controller's office has analyzed the data and has given you the results from the regression analysis:

SUMMARY OUTPUT
Regression Statistics
Multiple R 0.9268636
R Square 0.859076100
Adjusted R Square 0.846264837
Standard Error 20,787.50165
Observations 13

ANOVA
df SS MS F Significance F
Regression 1 28,976,388,996 28,976,388,996 -67.0563129 5.22932E-06
Residual 11 4,753,322,471 432,120,224.7
Total 12 33,729,711,467

Coefficients Standard Error t Stat P-value Lower 95% Upper 95% Lower 95.0% Upper 95.0%
Intercept 55,194.23940 17,848.58666 3.09235910 0.010242851 15,909.76503 94,478.7138 15,909.76503 94,478.7138
X Variable 1 108.8763555 13.29577754 8.188791907 5.22932E-06 79.61254647 138.140165 79.61254647 138.140165

If the controller uses the high-low method to estimate costs, the variable cost per credit hour is:

Multiple Choice

  • $201.02.

  • $111.86.

  • $103.46.

  • $82.23.

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