PA5-2

Please show any work or excel functions used.

PA5-2 Estimating Cost Behavior Using Scattergraph, High-Low, and Least- Squares Regression Methods LO 5-2, 5-3, 5-4 Leslie Sporting Goods is a locally owned store that specializes in printing team Page 249 jerseys. The majority of its business comes from orders for various local teams and organizations. While Leslie's prints everything from bowling team jerseys to fraternity/sorority event shirts, summer league baseball and softball team jerseys are the apparel to special company's biggest source of revenue. A portion of Leslie's operating information for the company's last year follows: Month Number of Jerseys Printed Operating Cost $5,500 January 215 February 210 5,740 March 380 5,800 April 625 8,675 750 May 9,000 June 630 9,760 July 400 6,200 350 6,155 August September 300 5,980 330 October 6,010 November 200 4,950 December 150 4,500 Required: 1. Prepare a scattergraph of Leslie's operating cost and draw the line you believe best fits the data 2. Based on this graph, estimate Leslie's total fixed costs per month. 3. Using the high-low method, calculate the store's total fixed operating costs and variable operating cost per jersey 4. Using the high-low method results, calculate the store's expected operating cost if it printed 480 jerseys 5. Perform a least-squares regression analysis on Leslie's data 6. Using the regression output, create a linear equation (y bx) for estimating Leslie's = a operating costs 7. Using the least-squares regression results, calculate the store's expected operating cost if it prints 625 jerseys. PA5-2 Estimating Cost Behavior Using Scattergraph, High-Low, and Least- Squares Regression Methods LO 5-2, 5-3, 5-4 Leslie Sporting Goods is a locally owned store that specializes in printing team Page 249 jerseys. The majority of its business comes from orders for various local teams and organizations. While Leslie's prints everything from bowling team jerseys to fraternity/sorority event shirts, summer league baseball and softball team jerseys are the apparel to special company's biggest source of revenue. A portion of Leslie's operating information for the company's last year follows: Month Number of Jerseys Printed Operating Cost $5,500 January 215 February 210 5,740 March 380 5,800 April 625 8,675 750 May 9,000 June 630 9,760 July 400 6,200 350 6,155 August September 300 5,980 330 October 6,010 November 200 4,950 December 150 4,500 Required: 1. Prepare a scattergraph of Leslie's operating cost and draw the line you believe best fits the data 2. Based on this graph, estimate Leslie's total fixed costs per month. 3. Using the high-low method, calculate the store's total fixed operating costs and variable operating cost per jersey 4. Using the high-low method results, calculate the store's expected operating cost if it printed 480 jerseys 5. Perform a least-squares regression analysis on Leslie's data 6. Using the regression output, create a linear equation (y bx) for estimating Leslie's = a operating costs 7. Using the least-squares regression results, calculate the store's expected operating cost if it prints 625 jerseys