Which of the following statements is true regarding regression analysis? Question 8 options: Regression analysis considers all of the data points for determining the line that best fits the data so it is usually less accurate than the high-low method. Regression analysis helps generate a statistic, called the R-square, which tells how well the line fits the data points. Regression analysis can only be used by manufacturing companies to predict costs. All of the above are true.

Which of the following statements is true regarding regression analysis? Question 8 options: Regression analysis considers all of the data points for determining the line that best fits the data so it is usually less accurate than the high-low method. Regression analysis helps generate a statistic, called the R-square, which tells how well the line fits the data points. Regression analysis can only be used by manufacturing companies to predict costs. All of the above are true.

Principles of Accounting Volume 2

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Chapter2: Building Blocks Of Managerial Accounting

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Problem 16MC: Which of the following methods of cost estimation relies on only two data points? A. the high-low...

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Which of the following methods of cost estimation relies on only two data points? A. the high-low method B. account analysis C. least-squares regression D. SWOT analysis.
Which of the following is NOT true of regression techniques for estimating costs? a) They permit the inclusion of more than one predictor. b) They typically use the highest and lowest activity points to estimate the relation between cost and activity. c) They help develop estimates that have a broader base than those based on a few select points. d) They are designed to generate a line that best fits a set of data points.
Which of the following statements related to cost estimation methods is true? O a. The low-high method is used to derive an estimated line of cost behavior by graphically connecting the two cost amounts identified with the highest and lowest volume levels. O b. The high-low method is the most accurate and reliable method to determine the cost behavior compared to scatter-graph plot and least-squares regression methods. O c. None of the given answers. O d. Only high-low method has a slope and an intercept. e. The most complex method of cost estimation is the high-low method.
Explain why cost predictions based on the same cost driver can differ when applying the high-low method and regression analysis. State one advantage and one disadvantage of the high-low method.
Carter Dry Cleaning has developed two regression analyses for cost estimation. The accounting manager has presented statistical measures for both of these regressions. Regression A has an R-squaredvalue of .53 and a t-value of 1.08. Regression B has an R-squared of .89 and a t-value of 2.17. Whatdo these statistical measures indicate about the regressions? Which regression should Carter DryCleaning use for cost estimation?
Question 2 A seminar was recently attended by the Managing Director of XYZ Manufacturing Company Limited located at Sheffield. The focus of the seminar was "optimising scarce resources utility in a manufacturing setting with particular reference to linear programming". On his return to his base, he called for a meeting with the Management to share his experience from the seminar and the impact this will have on the decision by the Board to produce two major products in the years ahead. A group of external research experts had previously been commissioned and the following represents information from the research carried out by them The expected products are "Best" and "Smart" with expected costs statistics as follows: Best £ £ Smart (3kg@£50/kg) Material costs (5kg@£50/kg) 250 150 Labour costs Machinery time 30 (4 hours @£15/Hr) 60 (4 hours @£10/hr) 40 (2hours @£15/Hr) (5hours@£10/Hr) Other Processing Time 50 The applicable pricing policy is based on total cost of production plus 20%…
The independent variable in regression analysis is: Multiple Choice Usually expressed as a range of values. The cost to be estimated. Hard to define because of its independence. The cost driver used to estimate the value of the dependent variable. Always a volume-based cost driver.
Which of the following statements related to cost estimation methods is false? O a. The most complex method of cost estimation is the high-low method. The low-high method is used to derive an estimated line of cost behavior by graphically connecting the two cost amounts identified with the highest and lowest volume levels. None of the given answers. O d. The least-squares regression method is the most accurate and reliable method to determine the cost behavior compared to scatter-graph plot and high-low methods. e. The three methods determine a slope and an intercept.
Which of the following statements related to cost estimation methods is true ? a . Only high -low method has a slope and an intercept . b. The scatter - graph method is used to derive an estimated line of cost behavior by graphically connecting the two cost amounts identified with the highest and lowest volume levels . c. The most complex method of cost estimation is the high - low method . d. The least -squares regression method is the most accurate and reliable method to determine the cost behavior compared to scatter -graph plot and high -low methods . e. None of the given answers
Which of the following statements related to cost estimation methods is false? The least-squares regression method is the most accurate and reliable method to determine the cost behavior compared to scatter-graph plot and high-low methods. O b. The low-high method is used to derive an estimated line of cost behavior by graphically connecting the two cost amounts identified with the highest and lowest volume levels. The three methods determine a slope and an intercept. O d. None of the given answers. The most complex method of cost estimation is the high-low method.
Which of the following statements related to cost estimation methods is false? a. The least-squares regression method is the most accurate and reliable method to determine the cost behavior compared to scatter-graph plot and high-low methods. O b. The low-high method is used to derive an estimated line of cost behavior by graphically connecting the two cost amounts identified with the highest and lowest volume levels. O c. The most complex method of cost estimation is the high-low method. O d. None of the given answers. O e. The three methods determine a slope and an intercept.
_____Identifying the relationship between the activity and the costs is a key step in which of the following cost estimation methods? a) Scattergraph. b) High-low method. c) Linear regression. d) Account analysis.

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	Regression analysis considers all of the data points for determining the line that best fits the data so it is usually less accurate than the high-low method.
	Regression analysis helps generate a statistic, called the R-square, which tells how well the line fits the data points.
	Regression analysis can only be used by manufacturing companies to predict costs.
	All of the above are true.