Baker Advertising Incorporated would like to estimate costs associated with its clients on an annual basis. Assume
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Baker Advertising Incorporated would like to estimate costs associated with its clients on an annual basis. Assume costs for supplies and advertising staff are variable costs. The accounting records indicate the following costs were incurred last year for 100 clients.
Required
a. Use account analysis to estimate total fixed costs per year, and the variable cost per unit. State your results in the cost equation form Y = f + vX.
b. Estimate the total costs for next year assuming 120 clients will be served.
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