Alden Company has decided to use a contribution format income statement for internal planning purposes. The company has analyzed its expenses and has developed the following cost formulas:

Cost	Cost Formula
Cost of goods sold	$28 per unit sold
Advertising expense	$178,000 per quarter
Sales commissions	6% of sales
Administrative salaries	$88,000 per quarter
Shipping expense	?
Depreciation expense	$58,000 per quarter

Management has concluded that shipping expense is a mixed cost, containing both variable and fixed cost elements. Units sold and the related shipping expense over the last eight quarters are given below:

Quarter	Units Sold	Shipping Expense
Year 1:
First	24,000	$168,000
Second	26,000	$183,000
Third	31,000	$225,000
Fourth	27,000	$188,000
Year 2:
First	25,000	$178,000
Second	28,000	$193,000
Third	38,400	$240,000
Fourth	35,400	$216,000

Management would like a cost formula derived for shipping expense so that a budgeted contribution format income statement can be prepared for the next quarter.

Required:
1.	Using the high-low method, estimate a cost formula for shipping expense based on the data for the last eight quarters above. (Omit the "$" sign in your response.)

Y = $ + $ X

2.

In the first quarter of Year 3, the company plans to sell 31,000 units at a selling price of $58 per unit. Prepare a contribution format income statement for the quarter. (Input all amounts as positive values except losses which should be indicated by a minus sign. Omit the "$" sign in your response.)

Alden Company Budgeted Income Statement For the First Quarter of Year 3
		$
Variable expenses:
	$
Total variable expenses
Fixed expenses:
Total fixed expenses
		$