PristinDay Company produces handheld calculators. The company controller wanted

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: Maintenance Machine Month cost hours June $5,000 350 July 3,000 320 August 4,000 315 September 3,300 220 Coefficients shown by a regression program are as follows: Intercept 1,000 X Variable 1 8.5 Using the results of regression, calculate the variable rate of maintenance cost. a. $6.65 per machine hour b. $12.00 per machine hour c. $10.24 per machine hour d. $8.50 per machine hour

Explanation / Answer

The variable rate of the maintenance is the value of Variable 1 which is $8.50 per machine hour Option D is correct

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