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[The following information applies to the questions displayed below.] Bargain Rental Car offers rental cars in an off-airport location near a major tourist destination in

[The following information applies to the questions displayed below.]

Bargain Rental Car offers rental cars in an off-airport location near a major tourist destination in California. Management would like to better understand the variable and fixed portions of it car washing costs. The company operates its own car wash facility in which each rental car that is returned is thoroughly cleaned before being released for rental to another customer. Management believes that the variable portion of its car washing costs relates to the number of rental returns. Accordingly, the following data have been compiled:

Month Rental Returns Car Wash Costs
January 2,500 $ 11,900
February 2,500 $ 13,600
March 2,800 $ 12,700
April 3,100 $ 15,600
May 3,700 $ 17,100
June 5,200 $ 25,100
July 5,600 $ 23,100
August 5,700 $ 24,400
September 4,800 $ 23,700
October 4,500 $ 23,800
November 2,300 $ 11,600
December 3,100 $ 17,400

Exercise 5A-2 Part 2

2. Using least-squares regression, estimate the variable cost per rental return and the monthly fixed cost incurred to wash cars. (Round Fixed cost to the nearest whole dollar amount and the Variable cost per unit to 2 decimal places.)

Fixed cost per month
Variable cost per rental return

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