Figure 3-14.Blacken Company manufactures motorcycles. The company's management accountant wants to calculate the fixed and variable costs associated with utility cost incurred by the factory. Data for the past five months were collected.
-Refer to Figure 3-14. Using a regression program, the yearly utility cost equation (with all variables to the nearest penny) is

Question

Figure 3-14.Blacken Company manufactures motorcycles. The company's management accountant wants to calculate the fixed and variable costs associated with utility cost incurred by the factory. Data for the past five months were collected. 
-Refer to Figure 3-14. Using a regression program, the yearly utility cost equation (with all variables to the nearest penny) is

Quizplus · Accepted Answer

The correct choice is B) total utility cost = $10,630.80 + ($8.83 × machine hours). This is a typical form of a linear regression equation, where $10,630.80 represents the fixed cost (the y-intercept) and $8.83 represents the variable cost per machine hour (the slope of the line).