The Following Excel Printout Provides Information to Estimate Overhead Costs

question 40

Essay

The following Excel printout provides information to estimate overhead costs using linear regression:
$\begin{array}{lrrrrrr}&&\text { Standard }\\&\text { Coefficients }&\text { Error }& t \text { Stat }&P \text {-value } &\text {Lower 95 \%}&\text { Upper } 95 \%\\\hline \text { Intercept } & 6035.987027 & 1411.05464 & 4.277642 & 0.002696 & 2782.0871 & 9289.88697 \\\text { DLH } & 4.558482698 & 1.609683731 & 2.831912 & 0.022085 & 0.846543 & 8.27042244 \\\text { \# setups } & 771.1028938 & 54.93418317 & 14.03685 & 6.44 \mathrm{E}-07 & 644.42436 & 897.781429 \\\text { \# moves } & 29.9411124 & 2.874675342 & 10.41548 & 6.26 \mathrm{E}-06 & 23.312095 & 36.5701299\end{array}$ $$\begin{array} { l r } \quad\quad\quad\quad { \text { Regression Stidistics } } \\\hline \text { Multiple R } & 0.996584412 \\\text { R Square } & 0.99318049 \\\text { Adjusted R Square } & 0.990623174 \\\text { Standard Errar } & 347.9563597 \\\text { Observations } & 12 \\\hline\end{array}$$
a.Write the multiple regression model (round to nearest cent).
b.What does the 't Stat' measure?
c.What is the estimate of overhead if the department has 1,205 DLH,55 setups,and 125 moves?

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Definitions:

Empirical Rule

A statistical rule stating that for a normal distribution, nearly all data will fall within three standard deviations of the mean.

Five-number Summary

A descriptive statistic that provides a quick overview of a data set's distribution, consisting of the minimum, first quartile, median, third quartile, and maximum.

Starting Salaries

The initial compensation that an employee receives when starting a new job.

Frequency Distribution

A representation, either in a graphical or table format, that displays the number of observations within a given interval.