The Method of Least Squares Was Used to Develop a Cost

question 30

Multiple Choice

The method of least squares was used to develop a cost equation to predict the cost of monthly equipment maintenance for the Regina Company. The following computer output was received:
The driver used was the number of machine hours.
$\begin{array}{lr}\text { Intercept } & 32,000 \\\text { Slope } & 25\end{array}$
-Refer to the Figure.What was the cost formula for equipment maintenance?

• A)total maintenance cost = $25 × machine hours
• B)total maintenance cost = $32,000
• C)total maintenance cost = $32,000 + ($25 × machine hours)
• D)total maintenance cost = $25 + ($32,000 × machine hours)

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