# An important application of regression analysis in accounting is in the estimation of cost. By collecting data on volume and cost and using the least squares method to develop an estimated regressionequation relating volume and cost, an accountant can estimate the cost associated with a particular manufacturing volume. Consider the following sample of production volumes and total cost data for amanufacturing operation.Production Volume (units)Total Cost (\$)400400045050005505400590060070064007000750a. Compute bị and bo (to 2 decimals if necessary).bịboComplete the estimated regression equation (to 2 decimals if necessary).хb. What is the variable cost per unit produced (to 1 decimal)?c. Compute the coefficient of determination (to 4 decimals). Note: report r between 0 and 1.=What percentage of the variation in total cost can be explained by the production volume (to 2 decimals)?d. The company's production schedule shows 500 units must be produced next month. What is the estimated total cost for this operation (to 2 decimals)?

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Step 1

a.

Let X be the production volume and Y be the total cost

From the given data

Step 2

The value of slope (b1) is

Step 3

The value of slope (b...

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