\'Copymasters\' provides various products and services in the Jericho Research P
ID: 2453104 • Letter: #
Question
'Copymasters' provides various products and services in the Jericho Research Park, home to numerous high-tech and bio-tech companies. Making color copies is one of its most popular and profitable services. The controller performed a regression analysis of data from the Color Copy Department with the following results:
The regression output was based on the following data:
Month
Number of Color Copies
Color Copy Department Costs
Required:
If 22,100 copies are made during January, what is the total cost predicted by each method? (Use the answers that you provided in 5-b and round your final answers to 2 decimal places.)
'Copymasters' provides various products and services in the Jericho Research Park, home to numerous high-tech and bio-tech companies. Making color copies is one of its most popular and profitable services. The controller performed a regression analysis of data from the Color Copy Department with the following results:
Explanation / Answer
5A) High low method
Variable cost per unit = $595/8500 = $.07
Variable cost $25,500 *.07 = $1,785
Fixed cost = $2040 - $1785 = $255
Variable cost $0.07 per unit and fixed cost $255
5B) y = a + bx
y = $255 + $.07 x
6) Total cost
Y = $255 + 22,100*.07
= $1,802
total cost = $449.26 + .05771 *22,100
= $1724.65
Units Costs High 25,500 $2040 Low 17,000 $1445 Difference 8,500 $595Related Questions
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