Question
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
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$201.02.
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$111.86.
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$103.46.
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$82.23.
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