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Scatter Diagrams and High - Low Cost Estimation From April 1 through October 3 1 , Will County Highway Department hires temporary employees to mow

Scatter Diagrams and High-Low Cost Estimation
From April 1 through October 31, Will County Highway Department hires temporary employees to mow and clean the right-of-way along county roads. The County Road Commissioner has asked you to help her in determining the variable labor cost of mowing and cleaning a mile of road. The following information is available regarding current-year operations:
Month Miles Mowed
and Cleaned Labor
Costs
April 350 $12,000
May 30011,250
June 40013,500
July 2508,250
August 37512,750
September 2007,500
October 1007,200
Use the information from the high- and low-volume months to develop a cost-estimating equation for monthly labor costs.
Monthly labor costs = Answer
5,100
+ Answer
21
X
Plot the data on a scatter diagram. Using the information from representative high- and low volume months, use the high-low method to develop a cost-estimating equation for monthly labor costs.
Monthly labor costs = Answer
5,100
+ Answer
21
X
Adjust the equation developed in requirement (b) to incorporate the effect of an anticipated 7 percent increase in wages.
Monthly labor costs = Answer
5,100
+ Answer
22.47
X

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