Burmer CoHas Accumulated Data to Use in Preparing Its Annual Profit

question 42

Multiple Choice

Burmer Co.has accumulated data to use in preparing its annual profit plan for the upcoming year.The cost behavior pattern of the maintenance costs must be determined.The accounting staff suggested that linear regression be employed to derive an equation for maintenance hours and costs.Data regarding the maintenance hours and costs for the last year and the results of the regression analysis are as follows:
Average cost per hour ($51,830 / 6,260) = $8.28 (rounded to the nearest cent) r = .99821;r 2= .99642.
The percent of the total variance that can be explained by the regression equation is:

• A)99.821%.
• B)69.670%
• C)81.049%
• D)99.780%.
• E)99.642%.

---

Definitions:

Disparities

Inequalities or differences, often in the context of social, economic, or health outcomes among different populations.

Wealth

An abundance of valuable material possessions or resources, including money, property, and other assets.

Institutionalized

The process of establishing something as a norm or standard within a structured system or organization, often associated with formal rules and conventions.

Superiority of Reason

The belief that reason and logical thinking are the highest means of understanding or solving problems, superior to emotion or faith.