A Regression Analysis Between Sales (Y)and Advertising (X)(both in Dollars)resulted

question 19

Multiple Choice

A regression analysis between sales (Y) and advertising (X) (both in dollars) resulted in the following equation: = 100 + 2000X The above equation implies that an

• A)increase of $1 in advertising is correlated with an increase of $2,000 in sales.
• B)increase of $1 in advertising is correlated with an increase of $2 in sales.
• C)increase of $1 in advertising is correlated with an increase of $100 in sales.
• D)increase of $1 in advertising is correlated with an increase of $2100 in sales.

---

Definitions:

Accounting Period

A specific period of time used by businesses for accounting purposes, often a fiscal year or quarter, to report financial performance.

Predetermined Overhead Rate

A rate used to allocate manufacturing overhead costs to products based on a predetermined formula.

Estimated Overhead Cost

Estimated overhead cost refers to the projected expenses related to manufacturing overhead or indirect costs that are expected to be incurred over a specified period.

Predetermined Overhead Rates

A rate calculated prior to the accounting period that is used to apply manufacturing overhead costs to products or job orders, based on an estimated amount of allocation base.