Using Regression to Calculate Fixed Cost, Calculate the Variable Rate, Construct a Cost Formula, and Determine Budgeted Cost Pizza Vesuvio makes specialty pizzas, Data for the past 8 months were collected Month Januar February Labor Cost $7,000 8,140 9,899 9,787 8,490 7,450 9,490 7,531 Employee Hours 360 550 630 610 480 350 570 310 April May June July August Coefficients shown by a regression program for Pizza Vesuvio's data are Intercept x Variable In your calculations, round the variable rate per employee hour to the nearest cent Required: Use the results of regression to make the following calculations: 1. Calculate the fixed cost of labor 4,517 8.20 Calculate the variable rate per employee hour per employee hour 2. Construct the cost formula for total labor cost x Employee hours) 3. Calculate the budgeted cost for next month, assuming that 690 employee hours are budgeted. Round answer to the nearest dollar Cost Behavior Alisha Incorporated manufactures medical stents for use in heart $16.50X where bypass surgery. Based on past experience. Alisha has found that its total maintenance costs can be represented by the following formula: on past x-Number of Heart Stents. Last Maintenance Cost -$348,000 + year. Alisha produced 80,000 stents. Actual maintenance costs for the year were as ex pected Required 1. What is the total maintenance cost incurred by Alisha last year? Round your answer to the nearest 2. What is the total fixed maintenance cost incurred by Alisha last year ? Round your answer to the nearest dollar 3. What is the total variable ble maintenance cost incurred by Alisha last year? Round your answer to the nearest dolla 4. What is the maintenance cost per unit produced? Round your answer two decimal places. per unit S. What is the firxed maintenance cost per unit? Round your answer two decimal places per unit 6. What is the variable maintenance cost per unit? Round your answer two decimal places. per unit High-Low Method Luisa Crimini has been operating a beauty shop in a college town for the past 10 years. Recently, Luisa rented space nxt to her shop and opened a tanning salon. She anticipated that the costs for the tanning service would primarily be fixed, but found that tanning salon costs increased with the number of appointments. Casts for this service over the past 8 months are as follows: Tanning Month January February March Total Cost $1,746 $2,170 $2,760 800 1,900 3,400 2,500 1,500 2,200 2,140 3,000 May June luly August $1,700 $2,275 $2,200 $2,610 1. Which month represents the high point? The low point? High point Low point In your calculations, round per unit costs to the nearest cent. 2. Using the high-low method, compute the variable rate for tanning. Compute the fixed cost per month. Round the varlable rate per tanning appointment to the nearest c per month to the nearest dollar and use it in your further calculations. arable rate for tanningper tanning appointment Fixed cost per month 3. Using the variable rate and fixed cost, what is the cost formula for tanning services? Check My Work 3 more Check My Werk uses remaining 3-19 PM eBook Calculator Method of Least Squares, Developing and Using the Cost Formula The method of least squares was used to develop a cost equation to predict the cost of receiving purchased parts at a video game manufacturer. Ninety-six data points from monthly data were used for the regression. The following computer output was received: Intercept Slope The cost driver used was number of parts inspected 183,200 295 1. What is the cost formula? Total cost of receiving 2 Using the coat formula from Requirement 1, identify each of the following: independent variable, dependent variable, Variable rate per professional hour, and fixed cost per month. Independent variable Dependent variable Variable rate per professional hour Fixed cost per month 3. Using the cost formula, predict the cost of receiving for a month in which 6,900 parts are inspected Total cast of receiving per part inspected Using Regression to Calculate Fixed Cost, Calculate the Variable Rate, Construct a Cost Formula, and Determine Budgeted Cost Pizza Vesuvio makes specialty pizzas, Data for the past 8 months were collected Month Januar February Labor Cost $7,000 8,140 9,899 9,787 8,490 7,450 9,490 7,531 Employee Hours 360 550 630 610 480 350 570 310 April May June July August Coefficients shown by a regression program for Pizza Vesuvio's data are Intercept x Variable In your calculations, round the variable rate per employee hour to the nearest cent Required: Use the results of regression to make the following calculations: 1. Calculate the fixed cost of labor 4,517 8.20 Calculate the variable rate per employee hour per employee hour 2. Construct the cost formula for total labor cost x Employee hours) 3. Calculate the budgeted cost for next month, assuming that 690 employee hours are budgeted. Round answer to the nearest dollar Cost Behavior Alisha Incorporated manufactures medical stents for use in heart $16.50X where bypass surgery. Based on past experience. Alisha has found that its total maintenance costs can be represented by the following formula: on past x-Number of Heart Stents. Last Maintenance Cost -$348,000 + year. Alisha produced 80,000 stents. Actual maintenance costs for the year were as ex pected Required 1. What is the total maintenance cost incurred by Alisha last year? Round your answer to the nearest 2. What is the total fixed maintenance cost incurred by Alisha last year ? Round your answer to the nearest dollar 3. What is the total variable ble maintenance cost incurred by Alisha last year? Round your answer to the nearest dolla 4. What is the maintenance cost per unit produced? Round your answer two decimal places. per unit S. What is the firxed maintenance cost per unit? Round your answer two decimal places per unit 6. What is the variable maintenance cost per unit? Round your answer two decimal places. per unit High-Low Method Luisa Crimini has been operating a beauty shop in a college town for the past 10 years. Recently, Luisa rented space nxt to her shop and opened a tanning salon. She anticipated that the costs for the tanning service would primarily be fixed, but found that tanning salon costs increased with the number of appointments. Casts for this service over the past 8 months are as follows: Tanning Month January February March Total Cost $1,746 $2,170 $2,760 800 1,900 3,400 2,500 1,500 2,200 2,140 3,000 May June luly August $1,700 $2,275 $2,200 $2,610 1. Which month represents the high point? The low point? High point Low point In your calculations, round per unit costs to the nearest cent. 2. Using the high-low method, compute the variable rate for tanning. Compute the fixed cost per month. Round the varlable rate per tanning appointment to the nearest c per month to the nearest dollar and use it in your further calculations. arable rate for tanningper tanning appointment Fixed cost per month 3. Using the variable rate and fixed cost, what is the cost formula for tanning services? Check My Work 3 more Check My Werk uses remaining 3-19 PM eBook Calculator Method of Least Squares, Developing and Using the Cost Formula The method of least squares was used to develop a cost equation to predict the cost of receiving purchased parts at a video game manufacturer. Ninety-six data points from monthly data were used for the regression. The following computer output was received: Intercept Slope The cost driver used was number of parts inspected 183,200 295 1. What is the cost formula? Total cost of receiving 2 Using the coat formula from Requirement 1, identify each of the following: independent variable, dependent variable, Variable rate per professional hour, and fixed cost per month. Independent variable Dependent variable Variable rate per professional hour Fixed cost per month 3. Using the cost formula, predict the cost of receiving for a month in which 6,900 parts are inspected Total cast of receiving per part inspected