Caiman Distribution Partners is the Brazilian distribution company of a U S consumer products firm Inflation in Brazil has made bidding and budgeting difficult for marketing managers trying to penetrate some of the country's rural regions The company expects to distribute 450,000 cases of products in Brazil next month The controller has classified operating costs (excluding costs of the distributed product) as follows AccountOperating Cost Behavior Supplies$370,000 All variable Supervision 200,000 $ 140,000 Fixed Truck expense 1,302,500 $190,000 Fixed Building leases 845,000 $540,000 Fixed Utilities 205,000 $120,000 Fixed Warehouse labor 855,000 $135,000 Fixed Equipment leases 770,000 $610,000 Fixed Data processing equipment 895,000 All fixed Other 850,000 $400,000 Fixed Total$6,292,500 Although overhead costs were related to revenues throughout the company, the experience in Brazil suggested to the managers that they should incorporate information from a published index of Brazilian prices in the distribution sector to forecast overhead in a manner more likely to capture the economics of the business Following instructions from the corporate offices, the controller's office in Brazil collected the following information for monthly operations from last year Month Cases Price Index Operating Costs 1 351,000 118 $ 5,759,139 2 368,000 120 5,866,638 3 364,000 121 5,909,905 4 386,000 125 5,987,617 5 380,000 127 5,999,135 6 401,000 128 6,103,364 7 373,000 131 5,978,495 8 418,000 136 6,193,868 9 404,000 136 6,186,130 10 427,000 135 6,246,625 11 423,000 139 6,268,799 12 438,000 142 6,422,255 These data are considered representative for both past and future operations in Brazil Required (a) Compute an estimate of operating costs assuming that 450,000 cases will be shipped next month based on the controller's analysis of accounts (b) Use the high low method to compute an estimate of operating costs assuming that 450,000 cases will be shipped next month (Round variable costs to five decimal places Round your other intermediate calculations and final answer to nearest whole dollar value ) (c) Compute an estimate of operating costs assuming that 450,000 cases will be shipped next month by using the results of a simple regression of operating costs on cases shipped (Round variable costs to five decimal places Round your other intermediate calculations and final answer to nearest whole dollar value ) (d) Compute an estimate of operating costs assuming that 450,000 cases will be shipped next month by using the results of a multiple regression of operating costs on cases shipped and the price level Assume a price level of 142 for next month (Round variable costs to five decimal places Round your other intermediate calculations and final answer to nearest whole dollar value )

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Caiman Distribution Partners is the Brazilian distribution company of a U.S. consumer products firm. Inflation in Brazil has made bidding and budgeting difficult for marketing

Caiman Distribution Partners is the Brazilian distribution company of a U.S. consumer products firm. Inflation in Brazil has made bidding and budgeting difficult for marketing managers trying to penetrate some of the country's rural regions. The company expects to distribute 450,000 cases of products in Brazil next month. The controller has classified operating costs (excluding costs of the distributed product) as follows: AccountOperating Cost Behavior Supplies$370,000 All variable Supervision 200,000 $ 140,000 Fixed Truck expense 1,302,500 $190,000 Fixed Building leases 845,000 $540,000 Fixed Utilities 205,000 $120,000 Fixed Warehouse labor 855,000 $135,000 Fixed Equipment leases 770,000 $610,000 Fixed Data processing equipment 895,000 All fixed Other 850,000 $400,000 Fixed Total$6,292,500

Although overhead costs were related to revenues throughout the company, the experience in Brazil suggested to the managers that they should incorporate information from a published index of Brazilian prices in the distribution sector to forecast overhead in a manner more likely to capture the economics of the business.

Following instructions from the corporate offices, the controller's office in Brazil collected the following information for monthly operations from last year:

Month	Cases		Price Index		Operating Costs
1		351,000		118	$	5,759,139
2		368,000		120		5,866,638
3		364,000		121		5,909,905
4		386,000		125		5,987,617
5		380,000		127		5,999,135
6		401,000		128		6,103,364
7		373,000		131		5,978,495
8		418,000		136		6,193,868
9		404,000		136		6,186,130
10		427,000		135		6,246,625
11		423,000		139		6,268,799
12		438,000		142		6,422,255

These data are considered representative for both past and future operations in Brazil.

Required:

(a)

Compute an estimate of operating costs assuming that 450,000 cases will be shipped next month based on the controller's analysis of accounts.

(b)

Use the high-low method to compute an estimate of operating costs assuming that 450,000 cases will be shipped next month. (Round variable costs to five decimal places. Round your other intermediate calculations and final answer to nearest whole dollar value.)

(c)

Compute an estimate of operating costs assuming that 450,000 cases will be shipped next month by using the results of a simple regression of operating costs on cases shipped. (Round variable costs to five decimal places. Round your other intermediate calculations and final answer to nearest whole dollar value.)

(d)

Compute an estimate of operating costs assuming that 450,000 cases will be shipped next month by using the results of a multiple regression of operating costs on cases shipped and the price level. Assume a price level of 142 for next month. (Round variable costs to five decimal places. Round your other intermediate calculations and final answer to nearest whole dollar value.)