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Author Question: Yancy Company manufactures chairs. Because the efforts of manufacturing are approximately equal ... (Read 76 times)

penza

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Yancy Company manufactures chairs. Because the efforts of manufacturing are approximately equal between labor and machinery, management is considering other possible cost drivers. By considering different cost drivers, it is anticipated that the estimating process can be improved. The following cost estimating equations with their r2 values have been determined for 2017: 

1.X = cutting timey = $19,500 + $20Xr2 = 0.65
2.X = labory = $5,000 + $25Xr2 = 0.49
3.X = machineryy = $44,500 + $5Xr2 = 0.55 

Required:
a.Which equation should be selected for the analysis?
b.What other factors should be included in the selection of the estimating equation? 


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Marked as best answer by penza on Mar 6, 2021

bd5255

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penza

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Reply 2 on: Mar 6, 2021
Excellent


tkempin

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Reply 3 on: Yesterday
Wow, this really help

 

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