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 variable rate of maintenance cost.
A) $6.65 per machine hour
B) $10.24 per machine hour
C) $8.50 per machine hour
D) $12.00 per machine hour

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 variable rate of maintenance cost.
A) $6.65 per machine hour 
B) $10.24 per machine hour 
C) $8.50 per machine hour 
D) $12.00 per machine hour

Quizplus · Accepted Answer

As the slope corresponds to the variable rate  the variable rate of
maintenance cost is $8.50 per machine hour.

PristinDay Company Produces Handheld Calculators