[The following information applies to the questions displayed below.]

Lexon Inc.is a large manufacturer of affordable DVD players. Management recently became aware of rising expenses resulting from returns of malfunctioning products. As a starting point for further analysis, Paige Jennings, the controller, wants to test different forecasting methods and then use the best one to forecast quarterly expenses for 2019. The relevant quarterly data for the previous three years follow:

2016

QuarterReturn Expenses2017

QuarterReturn Expenses2018

QuarterReturn Expenses1$13,6001$14,0001$14,400212,300213,100213,300312,600312,700313,100414,900415,200415,800

The result of a simple regression analysis using all 12 data points yielded an intercept of $12,909.09 and a coefficient for the independent variable of $129.37. (R-squared = 0.17, SE = $1,063.80.)

rev: 12_02_2019_QC_CS-191637