The Management of Hamano Corporation Would Like for You to Analyze

question 51

Multiple Choice

The management of Hamano Corporation would like for you to analyze their repair costs, which are listed below: Management believes that repair cost is a mixed cost that depends on the number of machine-hours. Using the least-squares regression method, the estimates of the variable and fixed components of repair cost would be closest to:

• A) $22.11 per machine-hour plus $98,497 per month
• B) $7.37 per machine-hour plus $65,670 per month
• C) $8.19 per machine-hour plus $62,015 per month
• D) $7.55 per machine-hour plus $64,859 per month

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Definitions:

Duo-servo Brakes

A brake system design where two brake shoes press outward against a drum, with each shoe's action amplifying the other's, enhancing braking efficiency.

Anchor

A device, usually made of metal, used to connect an object to a base or a fixed point to prevent or restrict movement.

Rotate

To turn or spin around an axis or center point.

Self-adjuster

A component in drum brakes that automatically maintains the correct distance between the brake shoes and drum.