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	2,600	$	19,250
February	3,000	$	22,700
March	2,000	$	14,350
April	3,200	$	24,700
May	3,900	$	29,100
June	3,400	$	23,700
July	4,200	$	25,600
August	3,600	$	23,600
September	2,100	$	17,200
October	3,800	$	27,700
November	4,800	$	32,700
December	4,300	$	28,600

Summary Output
Regression Statistics
Multiple R	0.955
R Square	0.912
Adjusted R2	0.904
Standard Error	1,630.46
Observations	12.00

	Coefficients	Standard Error	t Stat	P-value	Lower 95%	Upper 95%
Intercept	4,476.65	1,979.98	2.26	0.05	64.99	8,888.32
Machine Hours	5.76	0.56	10.20	0.00	4.50	7.01

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

• $1,260.00.

• $24,640.00.

• $4,476.65.

• $1,630.46.