Schotte Manufacturing Company uses two different independent variables (machine-hours and number of packages) in two different equations to evaluate costs of the packaging department. The most recent results of the two regressions are as follows:
Machine-hours:
Number of packages:
Required:
a. What are the estimating equations for each cost driver?
b. Which cost driver is best and why?

Question

Schotte Manufacturing Company uses two different independent variables (machine-hours and number of packages) in two different equations to evaluate costs of the packaging department. The most recent results of the two regressions are as follows:
Machine-hours:
   Number of packages:
   Required:
a. What are the estimating equations for each cost driver?
b. Which cost driver is best and why?

Quizplus · Accepted Answer

The Answer of Schotte Manufacturing Company uses two different independent variables (machine-hours and number of packages) in two different equations to evaluate costs of the packaging department. The most recent results of the two regressions are as follows:
Machine-hours:
   Number of packages:
   Required:
a. What are the estimating equations for each cost driver?
b. Which cost driver is best and why?

Schotte Manufacturing Company Uses Two Different Independent Variables (Machine-Hours and Number