Ethan Manufacturing Inc. produces floor mats for automobiles. The owner, Joseph Ethan, has asked you to assist in estimating maintenance costs. Together, you and Joseph determine that the single best cost driver for maintenance costs is machine hours. These data are from the previous fiscal year for maintenance costs and machine hours:

Month	Maintenance Costs				Machine Hours
1	$	2,600			1,690
2		2,760			1,770
3		2,910			1,850
4		3,020			1,870
5		3,100			1,900
6		3,070			1,880
7		3,010			1,860
8		2,850			1,840
9		2,620			1,700
10		2,220			1,100
11		2,230			1,300
12		2,450			1,590

Required:

1. What is the cost equation for maintenance costs using the high-low method?

2. Calculate the mean absolute percentage error (MAPE) for the cost equation you developed in requirement 1.

1.

What is the cost equation for maintenance costs using the high-low method? (Round "slope (unit variable cost)" to 2 decimal places. Include outliers in your calculations.)

Maintenance costs

=

+

(

x

)

2.

Calculate the mean absolute percentage error (MAPE) for the cost equation you developed in requirement 1. (Do not round intermediate calculations, with the exception of MAPE for each month, which should be rounded to three decimal places. Input your final answer as a percentage rounded to 1 decimal place (i.e., 0.054 = 5.4%). Include any outliers in your calculations.)

Mean absolute percentage error (MAPE)

%