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The Lockit Company manufactures door knobs for residential homes and apartments. Lockit is considering the use of simple and multiple linear regression analysis to forecast annual sales because previous forecasts have been inaccurate. The sales forecast will be used to initiate the budgeting process and to identify better the underlying process that generates sales.Larry Husky, the controller of Lockit, has considered many possible independent variables and equations to predict sales and has narrowed his choices to four equations. Husky used annual observations from twenty prior years to estimate each of the four equations.Following is a definition of the variables used in the four equations and a statistical summary of these equations:St = Forecasted sales (in dollars) for Lockit in time period t St-1 = Actual sales (in dollars) for Lockit in time period t - 1 Gt = Forecasted United States gross national product in time period t G t-1 = Actual United States gross national product in time period t - 1 N t-1 = Lockit's net income in time period t - 1Statistical Summary of Four EquationsCoefficientsDependent Independent Standard CoefficientDependent Independent Variable Variable Error of ofEquation Variable Variable(s) (Intercept) (Rate) the Estimate Correlation t-Value1 St St-1 +$ 500,000 +$ 1.10 $500,000 +.97 5.502 St Gt +$1,000,000 +$ .00001 $510,000 +.95 10.003 St Gt-1 +$ 900,000 +$.000012 $520,000 +.90 5.00St +$ 600,000 $490,000 +.98Nt-1 +$ 10.00 4.004 Gt +$.000002 1.50Gt-1 +$.000003 3.00Required:Write Equations 2 and 4 in the form y = a + bx.If actual sales are $1,500,000 in 2013, what would be the forecasted sales for Lockit in 2014 Explain the meaning and significance of the coefficient of correlation. Why might Larry Husky prefer Equation 3 to Equation 2?Explain the advantages and disadvantages of using Equation 4 to forecast annual sales.
Assuming the only changes in retained earnings in 2009 were for net income and a $25,000 dividend, what was net income for 2009?
Identify the different entities and their associated attributes that would be found in your potential relational database model for your sales database, pertaining to the hotel industry.
In 2010, he made six payments. How do the transactions in the divorce agreement affect Arnold's and Barbara's taxable income.
The Miller-Porter company sells powder coating equipment at a sales price of $50,000 per unit. The sales price includes delivery, installation, and initial testing of the equipment.
Compute earnings per share for 2012, using the weighted-average number of shares determined in part (a).
Leister Auto Supply does not segregate sales and sales taxes at the time of sale. The register total for March 16 is $15,540. All sales are subject to a 5% sales tax. Compute sales taxes payable, and make the entry to record sales taxes payable an..
During September 50,000 units were started; 5,000 of these were still in process at the end of September and were 3/5 finished. The equivalent units for the conversion costs in September were:
Several years ago Polar Inc. purchased an 80% interest in Icecap Co. The book values of Icecap's asset and liability accounts at that time were considered to be equal to their fair values. Polar paid an amount corresponding to the underlying book ..
Cash dividends were $43. The company sold equipment for $61 that was originally purchased for $28 and that had accumulated depreciation of $25. The net cash provided by (used in) operations for the year was:
The comparative advantages and disadvantages of ideal versus normal standards. The factors that should be included in setting the price and quantity standards for direct materials, direct labor, and manufacturing overhead.
Many public universities are quite similar to their private counterparts. Indeed, some large state universities receive less than 25 percent of their resources from the state. How, then, can you account for the substantial differences in their rep..
What is the common stock, retained earnings, cost of goods sold and net income. I have 5000 cash, 10000 inventory,45000 building,5000accounts payable.total liabitities stockholders 60000,revenues 80000 and administrative expeneses 10000
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