RAM Software, Inc

Essay

RAM Software, Inc. is an Inventory Management software company. Justin, a CPA, has recently been hired to oversee sales transactions. The CFO of RAM Software is concerned that some of the sales transactions are fraudulent which increase the commissions of the sales personnel. Justin wants to perform linear regression to identify red flags for fraud in the sales data. The company offers greater customer discounts on their software at the end of each quarter, and even greater discounts at the end of each fiscal year.
Justin's hypothesis is that sales transactions recorded at the end of a quarter, and particularly at the end of the year, are at greater risk of fraud. He will use linear regression to determine if the date of the sales transaction in the quarter or year is related to the percent of fraudulent sales transactions. In Justin's analysis, what is the dependent variable and what is the independent variable?