Smarty, Inc. is a value-added computer consulting company that specializes in providing services to small companies. The company owns and maintains several autos for use by sales staff. All expenses of operating these autos have been entered into an Automobile Expense account on the Companys books. Along with this record of expenses, the Company has also kept a careful record of the number of miles the autos have been driven each month. The companys records of miles driven and total auto expenses over the past 10 months are given below:

Month	Total Mileage	Total Cost
January	4,000	$ 3,000
February	8,000	$ 3,700
March	7,000	$ 3,300
April	12,000	$ 4,000
May	6,000	$ 3,300
June	11,000	$ 3,900
July	14,000	$ 4,200
August	10,000	$ 3,600
September	13,000	$ 4,100
October	15,000	$ 4,400

Required

Using the least squares regression method, answer the following questions (round all answers to two decimal places). Please attach the Excel spreadsheet.

1. What is the firms total fixed cost per month?

2. What is the firms variable operating cost per mile driven?

3. What is the firms total cost equation?

4. Based on the data provided, should the analyst have confidence in the estimated total cost equation? Why or why not?

5. Compute total operating costs if the firm drives 20,000 miles in November (rounded to the nearest dollar amount).