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Commerce · Q484

Costing

Graduate and Post Graduate · Commerce · question 484

Q484

In regression analysis, if predicted cost value is 65 and observed cost value is 19 then disturbance term will be

A.
46
Answer
B.
56
C.
36
D.
76

Answer: Option A

Solution

Answer: Option A
Solution:
In regression analysis, if predicted cost value is 65 and observed cost value is 19 then disturbance term will be 46.
Disturbance term cost = Predicted cost value - Observed cost value
= 65 - 19 = 46.