Problem 6-38 High-Low Method; Fitness Centers (LO 6-1, 6-2, 6-5) [The following information applies to the questions displayed below.] Nations Capital Fitness, Inc. operates a chain of fitness centers in the Washington, D.C., area. The firms controller is accumulating data to be used in preparing its annual profit plan for the coming year. The cost behavior pattern of the firms equipment maintenance costs must be determined. The accounting staff has suggested the use of the high-low method to develop an equation, in the form of Y = a + bX, for maintenance costs. Data regarding the maintenance hours and costs for last year are as follows: Month Hours of Maintenance Service Maintenance Costs January 530 $ 4,594 February 470 4,190 March 290 2,770 April 480 4,320 May 320 3,060 June 440 4,200 July 340 3,040 August 420 3,530 September 450 3,960 October 390 3,220 November 380 3,260 December 340 3,080 Total 4,850 $ 43,224 Average 404 * $ 3,602 * *Rounded rev: 05_30_2018_QC_CS-128090

Required informatio Problem 6-38 High-Low Method; Fitness Centers (LO 6-1, 6-2, 6-5) [The following information applies to the questions displayed below.] Nation's Capital Fitness, Inc. operates a chain of fitness centers in the Washington, D.C., area. The firm's controller is accumulating data to be used in preparing its annual profit plan for the coming year. The cost behavior pattern of the firm's equipment maintenance costs must be determined. The accounting staff has suggested the use of the high-low method to develop an equation, in the form of Y = a + bX, for maintenance costs. Data regarding the maintenance hours and costs for last year are as follows Hours of Maintenance Maintenance Costs Month January February March April May une July August September October November December Total Service 530 470 290 480 320 440 340 420 450 390 380 340 4,594 4,190 2,770 4,320 3,060 4,200 3,040 3,530 3,960 3,220 3,260 3,080 4,850 $43,224 Average 404* $3,602* Rounded