Marigold Company makes furniture.The company controller wanted to calculate the fixed and variable costs associated with electricity use in 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 electricity.
A) $3,500
B) $5,000
C) $2,700
D) None of these are correct.

Question

Marigold Company makes furniture.The company controller wanted to calculate the fixed and variable costs associated with electricity use in 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 electricity.
A) $3,500 
B) $5,000 
C) $2,700 
D) None of these are correct.

Quizplus · Accepted Answer

As the intercept corresponds to fixed cost, the fixed cost of electricity is $3,500.

Marigold Company Makes Furniture