Total Factory Overhead Costs (FOH) information of a factory for the past eight months are given below:

Required:(10 points)

1.Using the high-low method, determine the formula for total Factory Overhead Costs.

2.Using the cost formula you derived above, what total FOH costs would you expect to be incurred during a month in which 4,500 units are produced?

3.The following cost function was the result of a least-squares regression analysis:

Y=$11,529 + $17.85X

R=0.9508

4.Should the manager use the high-low or the regression method? Explain your answer.