PristinDay Company produces handheld calculators.The company controller wanted to calculate the fixed and variable costs associated with the maintenance cost incurred by the factory.Data for the past four months were collected as follows:

Coefficients shown by a regression program are as follows:

-Using the results of regression, calculate the fixed cost of maintenance.
A) $1,000
B) $900
C) $825
D) None of these are correct.

Question

PristinDay Company produces handheld calculators.The company controller wanted to calculate the fixed and variable costs associated with the maintenance cost incurred by the factory.Data for the past four months were collected as follows:  
 
 Coefficients shown by a regression program are as follows:

-Using the results of regression, calculate the fixed cost of maintenance.
A) $1,000 
B) $900 
C) $825 
D) None of these are correct.

Quizplus · Accepted Answer

As the intercept corresponds to fixed cost, the fixed cost of maintenance is equal to $1,000.

PristinDay Company Produces Handheld Calculators