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XYZ Company's accountant is estimating next period's total overhead costs (Y). She performed three regression analyses, the first is based on direct labor hours (DLH),
XYZ Company's accountant is estimating next period's total overhead costs (Y). She performed three regression analyses, the first is based on direct labor hours (DLH), the second is based on machine hours (Mhr), and the third is based on quantity produced (0). The results were: [Y=$95,000 + $9xDLH; R-square = 0.85]: [Y= $120,000 + $5xMhr; R-square = 0.15); [Y-190,000+20; R-square=0.45). How much of the variations on the overhead costs is explained by the quantity produced (Q)? Select one: a. 85% b. None of the answers given C. 55% d. 45% e. 15% Company XYZ sells two products: AAA and BBB, Product 008 has a higher selling price but lower contribution margin compared to product AAA. Assume that the tactory has feed production capacity. It Company XYZ decided to produce and self more units of product B2B compared to product AAA, which one of the following is likely to happen? Select one a. Total profits will decrease Total profits will remain the same Total profit will increase d. None of the given answers e. Total sales will decrease XYZ Company's accountant is estimating next period's total overhead costs (Y). She performed three regression analyses, the first is based on direct labor hours (OLH), the second is based on machine hours (hr), and the third is based on quantity produced (O). The results were: [Y-$150,000 $10XDLHR-aquare - 0.96). IY-$190,000 $5XMhe, R-square - 0.111: [Y-200,000+20, R-square-0 $21Based on this information, which cost driver do you recommend? Select one: - Direct labor hours (DLH) b. Machine hours (Mihr) c. Quantity produced Q d. None of them
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