! Required information [The following information applies to the questions displayed below.] Davis Stores sells clothing in 15 stores located around the southwestern United States. The managers at Davis are considering expanding by opening new stores and are interested in estimating costs in potential new locations. They believe that costs are driven in large part by store volume measured by revenue. During a discussion, one of the managers suggests that number of employees might be better at explaining cost than store revenues. As a result of that suggestion, managers collected the following information from last year's operations (revenues and costs in thousands of dollars): Store Costs $5,292 Employees 50 Revenues $6,803 101 102 2,868 25 3,362 103 5,141 52 P,240 104 2,292 30 2,531 105 4,576 33 3,571 106 5,521 53 6,848 107 4,186 40 2,876 108 2,932 44 3,296 109 2,437 30 4,738 110 5,431 34 5,832 111 5,909 54 4,201 112 3,214 41 4,319 113 2,010 24 4,781 114 5,796 46 3,628 115 2,827 33 4,991 Required - In the hinh la mathad to antimate the fund and ninhin nation of an bead an amalan 3,571 106 5,521 53 6,848 107 4,186 40 2,876 108 2,932 44 3,296 109. 2,437 30 4,738 110 5,431 34 5,832 111 5,909 54 4,201 112 3,214 41 4,319 113 2,018 24 4,781 114 5,796 46 3,628 115 2,827 33 4,991 Required a. Use the high-low method to estimate the fixed and variable portions of store costs based on employees. (Do not round your intermediate calculations. Negative amounts should be indicated by a minus sign. Round your answers to 2 decimal places. Enter your answers in thousands of dollars.) Variable cost (per employee) Fixed cost 3,240 104 2,292 30 2,531 105 4,576 33 3,571 106 5,521 53 6,848 107 4,186 40 2,876 108 2,932 44 3,296 109 2,437 30 4,738 110 5,431 34 5,832 111 5,909 54 4,201 112 3,214 41 4,319 113 2,018 24 4,781 114 46 5,796 2,827 3,628 115 33 4,991 b. Use the results of your high-low analysis to estimate the cost for a store with 45 employees. (Do not round your intermediate calculations. Negative amounts should be indicated by a minus sign. Round your answer to the nearest whole number (in thousands of dollars).) Store cost Instructions: 1. Click on a point to the right of the graph. 2. Click within the graph to place the point. 3. To enter exact coordinates, click on the point and then click on the processing wheel symbol and then enter the exact coordinates in the dialog box that pops up. 4. Click OK. Methods of Estimating Costs: Davis Stores Shore 101 100 Sow 100 Sto 104 Stor 105 Stor 106 Stor107 Costs ($000) $7,000 $6,000- $5,000- $4,000 $3.000- $2.000- $1,000- 10 10 20 30 R d-1. Enter the regression coefficients. d-2. Estimate the cost of a store with 45 employees using the results from a simple regression of store cost on employees. Complete this question by entering your answers in the tabs below. Req D1 Req D2 Enter the regression coefficients. (Round your answers to 2 decimal places. Negative amounts should be indicated by a minus sign.) Intercept Employees
d-1. Enter the regression coefficients. d-2. Estimate the cost of a store with 45 employees using the results from a simple regression of store cost on employees. Complete this question by entering your answers in the tabs below. Req D1 Req D2 Estimate the cost of a store with 45 employees using the results from a simple regression of store cost on employees. (Round your intermediate calculations and final answer to 2 decimal places.) Store cost pre regression of store of $2.60 million and 45 employees using the results of a multiple regression of costs on store revenues and employees. Complete this question by entering your answers in the tabs below. Req E1 Req E2 Estimate the cost of a store with revenues of $2.60 million and 45 employees using the results of a multiple regression of store costs on store revenues and employees. (Round "Intercept", "Employees" and "Revenues" to 2 decimal places in the intermediate calculations. Round your final answers to 2 decimal places.) Store cost d-1. Enter the regression coefficients. d-2. Estimate the cost of a store with 45 employees using the results from a simple regression of store cost on employees. Complete this question by entering your answers in the tabs below. Req D1 Req D2 Estimate the cost of a store with 45 employees using the results from a simple regression of store cost on employees. (Round your intermediate calculations and final answer to 2 decimal places.) Store cost pre regression of store of $2.60 million and 45 employees using the results of a multiple regression of costs on store revenues and employees. Complete this question by entering your answers in the tabs below. Req E1 Req E2 Estimate the cost of a store with revenues of $2.60 million and 45 employees using the results of a multiple regression of store costs on store revenues and employees. (Round "Intercept", "Employees" and "Revenues" to 2 decimal places in the intermediate calculations. Round your final answers to 2 decimal places.) Store cost
