George Caloz & Frres, located in Grenchen, Switzerland, makes prestige high-end custom watches in small lots. One

George Caloz & Frères, located in Grenchen, Switzerland, makes prestige high-end custom watches in small lots. One of the company’s products, a platinum diving watch, goes through an etching process. The company has observed etching costs (expressed in Swiss Francs. SFr) as follows over the last six weeks:

For planning purposes, management would like to know the amount of variable etching cost per unit and the total fixed etching cost per week.

Required:

1. Using the least-squares regression method, estimate the variable and fixed elements of etching cost.

2. Express the cost data in (1) above in the form Y = a + bX.

3. If the company processes five units next week, what would be the expected total etching cost?

Transcribed Image Text:

Total Etching Cost Week Units SFr18 17 2 25 20 24 16 30 SFr120 4) 3. 3. 4.