Explain

TAFEI HIGHER EDUCATION EXAMINATION QUESTION BOOKLET QUESTION 3 - High-Low Analysis and Linear Regression (11 Marks) As part of his job as cost analyst, Max Thompson collected the following information concerning the operations of the Machining Department: Observation Machine hours Total Operating Costs January 4,700 $43,000 February 5,060 45,395 March 4,180 42,535 April 4,500 43,600 May 4,250 42,890 Required: () Use the high-low method to determine the estimating cost function with machine- hours as the cost driver. (2 marks) (ii) If June's estimated machine-hours are 4,300, calculate the total estimated costs of the Machining Department? (2 marks) (1) Find the Linear Regression equation. (4 marks) (iv) Which method should Max use to predict Operating costs with a given number of machine hours? Explain briefly