QUESTION ONE

The following data were extracted from the records of Ufanisi Limited.

Period Quantity Cost of inspections

(Units) (Sh.)

19,000 327,000

2 15,000 375,000

3 600 259,800

4 18,000 399,000

a.Using the high-low method, what is the estimated cost of carrying out inspection in period 5 on 12,000 units?(3 Marks)

b. would the estimatedcost of inspection be any different if Ufanisi limited used the following methods : i). regression method(8 Marks )

ii). Scatter graph(4 Marks)