Thane Company is interested in establishing the relationship between electricity costs and machine hours. Data have been collected and a regression analysis prepared using Excel. The monthly data and the regression output follow:

Month	Machine Hours	Electricity Costs
January	3,300	$	18,800
February	3,700	$	21,800
March	2,700	$	13,900
April	3,900	$	23,800
May	5,200	$	28,650
June	4,100	$	22,800
July	5,100	$	25,150
August	4,300	$	23,150
September	2,800	$	16,300
October	4,500	$	26,800
November	6,200	$	31,800
December	5,700	$	28,150

Summary Output
Regression Statistics
Multiple R	0.957
R Square	0.916
Adjusted R2	0.908
Standard Error	1,584.49
Observations	12.00

	Coefficients	Standard Error	t Stat	P-value	Lower 95%	Upper 95%
Intercept	3,998.65	1,911.17	2.09	0.06	(259.71)	8,257.01
Machine Hours	4.53	0.43	10.47	0.00	3.56	5.49

If the controller uses the high-low method to estimate costs, the fixed cost portion of the cost equation for electricity costs is: (Round intermediate calculations to 2 decimal places.)

Multiple Choice

• $3,998.65.

• $1,584.49.

• $118.00.

• $22,782.00.

The College of Business at Northeast College is accumulating data as a first step in the preparation of next year's budget development. One cost that is being looked at closely is administrative costs as a function of student credit hours. Data on administrative costs and credit hours for the past thirteen months are shown below:

Month	Administrative Costs				Credit Hours
July		$	130,251		1,200
August			83,373		609
September			226,150		1,886
October			216,774		1,494
November			258,453		1,803
December			185,399		1,606
January			219,897		1,833
February			245,570		1,867
March			209,842		1,558
April			192,115		1,617
May			250,928		1,854
June			171,178		914
July			128,737		809
Total		$	2,511,067		19,050
Average		$	193,744		1,465

The controller's office has analyzed the data and has given you the results from the regression analysis:

SUMMARY OUTPUT
Regression Statistics
Multiple R	0.9115513
R Square	0.830925708
Adjusted R Square	0.815555318
Standard Error	22,754.96587
Observations	13

ANOVA
	df	SS	MS	F	Significance F
Regression	1	27,991,726,133	27,991,726,133	-54.0601571	1.4436E-05
Residual	11	5,695,673,188	517,788,471.6
Total	12	33,687,399,321

	Coefficients	Standard Error	t Stat	P-value	Lower 95%	Upper 95%	Lower 95.0%	Upper 95.0%
Intercept	33,100.32024	22,741.85454	1.45548025	0.17347479	-16,954.16413	83,154.8046	-16,954.16413	83,154.8046
X Variable 1	109.6253458	14.90981739	7.352561263	1.4436E-05	76.80905896	142.441633	76.80905896	142.441633

Based on the results of the regression analysis, the estimate of the variable portion of administrative costs in a month with 200 credit hours would be:

Multiple Choice

• $141,847.

• $21,926.

• $118,437.

• $42,874.