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 1015 102 103 104 105 106 107 108 109 110 Costs 4,214 2,894 5,181 3,998 3,676 3,319 5,029 2,374 4,688 2,959 4,179 3,200 2,556 4,655 2,986 Employees 395 29 47 38 33 38 54 26 Revenues 4,100 2,227 5.738 3,982 2,914 4,023 6,894 1,779 5,416 3,228 3,886 4.690 3,552 4,017 2,124 112 113 35 37 41 35 42 28 114 115 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 calculation, Negative amounts should be indicated by a minus sign. Round your answer to the nearest whole number (in thousands of dollars).) Variable cost (per employee) Fixed cost 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 1015 102 103 104 105 106 102 108 109 110 111 112 113 114 115 Costs 4,214 2,894 5,181 3,998 3,676 3,319 5,029 2,374 4,688 2,959 4,179 3,200 2.556 4,655 2,986 Employees 39 $ 29 47 38 33 38 54 26 44 35 37 41 35 42 28 Revenues 4,100 2,227 5,738 3,982 2,914 4,023 6,894 1,779 5,416 3,228 3,886 4,690 3,552 4,817 2,124 b. Use the results of your high-low analysis to estimate the cost for a store with 30 employees. (Do not round your intermediate calculation. Enter your answers in thousands of dollars.) Store Cool e suyyun, olayers LCCLC Worlobu ya operas Veves I LUSSIVUSTUS dollars): Employees 395 Store 1013 102 103 104 105 106 182 103 109 110 111 112 113 114 115 Costs 4,214 2,894 5,181 3.998 3.676 3,319 5,029 2,374 4,688 2,959 4,179 3,200 2.556 4,655 2,986 29 47 38 33 38 54 26 44 35 37 41 35 42 28 Revenues 4,100 2,227 5,738 3.982 2,914 4,023 6,894 1.779 5,416 3,228 3,886 4,690 3,552 4,817 2.124 Using the results from a simple regression of store cost on employees input the following data: d-1. Enter the regression coefficients. d-2. Estimate the cost of a store with 30 employees using the results from a simple regression of store cost on employees. Complete this question by entering your answers in the tabs below. Reg 01 Reg 02 Enter the regression coefficients (Round your answers to 1 decimal place. Negative amounts should be indicated by a minus sign.) Intercept Employees ReqD2 ) Shved Suyyerslun, Hiday LUNILI UWE perseveres diu LUSES VUSTUS dollars) Esployees 39$ 29 Store 101$ 102 103 104 105 106 107 188 109 110 111 112 113 114 115 Costs 4.214 2,894 5,181 3,998 3,676 3.319 5,029 2,374 4,688 2,959 4,179 3,200 2,556 4,655 2,986 26 Revenues 4,160 2,227 5,238 3,982 2,914 4,023 6,894 1,779 5,416 3,228 3,886 4,690 3,552 4,817 2,124 35 37 41 35 42 28 Using the results from a simple regression of store cost on employees, input the following data: d-1. Enter the regression coefficients. d-2. Estimate the cost of a store with 30 employees using the results from a simple regression of store cost on employees Complete this question by entering your answers in the tabs below. Reg D1 Reg D2 Estimate the cost of a store with 30 employees using the results from a simple regression of store cost on employees. (Round your intermediate calculations to 1 decimal place Round your answer to I decimal place.) Store cost
