2. an analyst at squirtle corp. is working on a capital project proposal. the project is expected to require purchasing long-term assets with an installed cost of $600,000. it will also require an increase in net working capital of $75,000. at the end of the 5th year, the project will be terminated, at an after-tax cost of $15,000. the project is expected to generate annual after-tax operating cash flows of $150,000 each year for 5 years. squirtle requires a return on capital projects of 10%. should they make the investment?

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 regression equation 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 a manufacturing operation. production volume (units) total cost ($) 400 4000 450 5000 550 5400 600 5900 700 6400 750 7000 compute b 1 and b 0 (to 2 decimals if necessary). b 1 b 0 complete the estimated regression equation (to 2 decimals if necessary). = + x what is the variable cost per unit produced (to 1 decimal)? $ compute the coefficient of determination (to 4 decimals). note: report r 2 between 0 and 1. r 2 = what percentage of the variation in total cost can be explained by the production volume (to 2 decimals)? % 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)? $