The College of Business at Northeast College Is Accumulating Data

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:
$\begin{array}{lrr}& \text { Administrative } & \text { Credit } \\\text { Month } & \text { Costs } & \text { Hours }\\\text { July } & \$ 129,301 & 250 \\\text { August } & 82,613 & 115 \\\text { September } & 225,580 & 1,392 \\\text { October } & 216,394 & 1,000 \\\text { November } & 258,263 & 1,309\\\text { December } & 184,445 & 1,112 \\\text { January } & 219,137 & 1,335 \\\text { February } & 245,000 & 1,373 \\\text { March } & 209,462 & 1,064 \\\text { April } & 191,925 & 1,123 \\\text { May } & 249,978 & 1,360\\\text { June } & 170,41 \varepsilon & 420 \\\text { July } & 128,167 & 315 \\\text { Total } & \$ 2,510,687 & 12,172 \\\text { Average } & \$ 193,130 & 936\end{array}$


The controller's office has analyzed the data and has given you the results from the regression analysis:
$$\begin{array}{c} { \text { SUMMARY OUTPUT } } \\ { \text { Regression Statistics } } \\\begin{array} { | l | r | } \hline \text { Multiple R } & 0.9317157 \\\hline \text { R Square } & 0.868094147 \\\hline \text { Adjusted R Square } & 0.856102705 \\\hline \text { Standard Error } & 20,134.92395 \\\hline \text { Observations } & 13 \\\hline\end{array}\end{array}$$
$$\begin{array} { | l | r | r | r | r | r | } \hline \text { ANOVA } & & & & & \\\hline & \text { df} & \text { S S } & \text { M S } & \text { F } & \text { Significance } \text { F } \\\hline \text { Repression } & 1 & 29,349,143,514 & 29,349,143,514 & 72.3928117 & 3.61909 \mathrm { E } - 06 \\\hline \text { Residual } & 11 & 4,459,566,787 & 405,415,162.4 & & \\\hline \text { Total } & 12 & 33,808,710,301 & & & \\\hline\end{array}$$


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If the controller uses regression analysis to estimate costs, the estimate of the variable portion of administrative costs is:

A) Variable Costs = $8.63 × Credit hours.
B) Variable Costs = $0.87 × Credit hours.
C) Variable Costs = $103.06 × Credit hours.
D) Variable Costs = $11.99 × Credit hours.