The Bhaskara Corporation used regression analysis to predict the annual cost of indirect materials

ACCOUNTING

Multiple Choice

The Bhaskara Corporation used regression analysis to predict the annual cost of indirect materials. The results were as follows:



Indirect Materials Cost Explained by Units Produced

Constant $21,890

Standard error of Y estimate $4,560

r2 0.7832

Number of observations 22



X coefficient(s) 11.75

Standard error of coefficient(s) 2.1876



What is the linear cost function?

a. Y = $21,890 + $11.75X

b. Y = $4,560 + $5.15X

c. Y = $20,100 + $4.60X

d. none of the above

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