Question

Hello, I need help with QUESTION 2 ONLY. thanks!!

Question: Crazy Cases has a small kiosk in the local mall, they sell cellphone cases and accessories. The c...

Crazy Cases has a small kiosk in the local mall, they sell cellphone cases and

accessories. The company has the following actual data for 2012, the kiosk opened

in early April.

Month

   

Production

(Units)

                         Overhead

                                Costs

Apr 5,000                12,000

May 5,750               16,000

Jun 7,500                 18,500

Jul 7,750                  19,750

Aug 12,000                27,000

Sep 11,500                 26,500

Oct 10,000                  20,000

Nov 6,000                     17,750

Dec 5,500                      14,250

1. Estimate the cost function for Overhead Costs using high/low method.

2. Using the information provide on next page, what is the cost function based

on the regression analysis. What does the R Square value tell you?

SUMMARY

OUTPUT

Regression Statistics

Multiple R 0.9524

R Square 0.9070

Adjusted R Square 0.8938

Standard Error 1645.89

Observations 9

ANOVA

df SS F

Significance

F

Regression 1 185162107 68.35111 7.3841E-05

Residual 7 18962893.01

Total 8 204125000

Coefficients Standard Error t Stat P‐value

Intercept 4835.270369 1808.608 2.67 0.031838873

X Variable 1 1.80609248 0.218457 8.26 7.3841E-05

Answer 1