Radio City is a manufacturer of radios. The cost of electricity is considered a mixed cost by the company. The variable portion of the electricity cost is assumed to be dependent on the number of units produced. The following is the related cost and activity data for the past six months:

Month Production (# of units) Electricity Cost

January70,000 $6,000

February45,000 $4500

March 35,000 $3800

April 25,000 $3400

May 32,000 $3700

June 60,000 $5200

Please answer the following TWO questions

a) Utilizing the high-low, method determine the cost equation (i.e, what is the variable cost per unit and what is the fixed cost)

b) Assume that a regression was run that returned the following formula y = 0.079x + 1,842. What are the fixed and variable costs in this equation?