ACCOUNTING TERMS - ACCOUNTING DICTIONARY - ACCOUNTING GLOSSARY
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LEAST-SQUARED METHOD Definition
LEAST-SQUARED METHOD of approximating cost is a statistical approach that is both objective and considers all the data points. By using mathematical formulas to arrive at the best possible cost line (i.e., the regression line), it is more accurate than the methods mentioned previously. The regression line is in the form Y=a + bX, where X is the independent variable and Y is the dependent variable. The coefficient of determination (R2) can be used to judge the line's goodness of fit.
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NORMAL BALANCE, in accounting, is the side of an account, whether debit or credit, to which increases to the account are recorded.
BOUGHT DEAL is the arrangement where a broker buys all of a new issue of shares and sells them on to investors at a small premium.