5-68 (Algo) Cost Estimation: Simple and Multiple Regression Using a Spreadsheet (Appendix A) (LO 5-4, 5, 6, 9) [The following information applies to the questions displayed below.] Davis Stores sells clothing in 15 stores located around the southwestern United States. The managers at Davis are considering expanding by opening new stores and are interested in estimating costs in potential new locations. They believe that costs are driven in large part by store volume measured by revenue. During a discussion, one of the managers suggests that number of employees might be better at explaining cost than store revenues. As a result of that suggestion, managers collected the following information from last year's operations (revenues and costs in thousands of dollars): Store 101 Costs $4,754 Employees Revenues 44 $2,844 102 5,548 52 5,055 103 3,262 42 2,920 104 3,216 37 6,380 105 5,503 57 5,946 106 3,513 35 2,261 107 5,052 41 3,847 108 3,466 33 2,064 109 2,149 30 4,856 110 3,286 37 4,844 111 5,086 55 6,574 112 5,933 58 2,400 113 3,809 55 5,468 114 3,090 41 6,600 115 4,626 48 3,915 109 2,149 30 4,856 110 3,286 37 4,844 111 5,086 55 6,574 112 5,933 58 2,400 113 3,809 55 5,468 114 3,090 41 6,600 115 4,626 48 3,915 Problem 5-68 (Algo) Part a Required a. Use the high-low method to estimate the fixed and variable portions of store costs based on employees. (Do not round your intermediate calculations. Negative amounts should be indicated by a minus sign. Round your answers to 2 decimal places. Enter your answers in thousands of dollars.) Variable cost (per employee) Fixed cost