Larson's Stables Uses Two Different Independent Variables in Two Different

question 57

Multiple Choice

Larson's Stables uses two different independent variables in two different equations to evaluate the cost activities of training horses, trainer's hours, and number of horses. The most recent year's results of the two regressions are as follows: Trainer's hours:
r² = 0.56
Number of horses:
r² = 0.63
What is the estimated cost for the coming year if 16,000 trainer hours are incurred and the stable has 400 horses to be trained based on the best cost driver?

• A) $33,555.50
• B) $99,929.09
• C) $350,756.50
• D) $335,313.32
• E) $13,844,444.50

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Definitions:

Stockholders' Equity

Stockholders' Equity is the residual interest in the assets of a corporation after deducting liabilities, representing ownership equity spread amongst shareholders.

EPS Reporting

The process of disclosing earnings per share, a key financial ratio indicating the portion of a company's profit allocated to each outstanding share of common stock.

GAAP

Generally Accepted Accounting Principles, a set of accounting standards and practices used in the United States to ensure financial statements are consistent and transparent.

IFRS

International Financial Reporting Standards, which are a set of accounting standards developed by the International Accounting Standards Board (IASB) that serve as a global framework for financial reporting.