Using Regression Results to Construct and Apply a Cost Formula McGarvey Manufacturing Company had the following 12 months of data on purchasing cost and number of purchase orders, Number of Purchase Month Purchasing Cost Orders January $19,250 370 February 18,050 330 March 18,200 320 April 18,050 410 May 19,345 400 June 19,500 450 July 19,670 460 August 20,940 560 September 19,430 440 October 20,020 600 November 18,800 470 December 19,340 480 The controller for McGarvey Manufacturing ran regression on the data, and the coefficients shown by the regression program are: Intercept 15,676 (rounded to the nearest dollar) X variable 1 8.03 (rounded to the nearest cent) Required: 1. Construct the cost formula for the purchasing activity showing the fixed cost and the variable rate October 20,020 600 November 18,800 470 December 19,340 480 The controller for McGarvey Manufacturing ran regression on the data, and the coefficients shown by the regression program are: Intercept 15,676 (rounded to the nearest dollar) X variable 1 8.03 (rounded to the nearest cent) Required: 1. Construct the cost formula for the purchasing activity showing the fixed cost and the variable rate. x Purchase orders) Total purchasing cost 2. If McGarvey Manufacturing Company estimates that next month will have 480 purchase orders, what is the total estimated purchasing cost for that month (Round your answer to the nearest dollar.) 3. What if McGarvey Manufacturing wants to estimate purchasing cost for the coming year and expects 6,000 purchase orders? What will estimated total purchasing cost be? (Round your answer to the nearest dollar.) What is the total fixed purchasing cost? Why doesn't it equal the fixed cost calculated in Requirement 1 above? Next