Question

Furlan Printing Corp., a book printer, has provided the following data: Titles Printed 30 31 May June July August September October November December WAND Puw u vivio Press Setup Cost 3,176 $ 3,209 3,694 3,002 3,613 3,557 3,559 $ 3,130 40 36 Management believes that the press setup cost is a mixed cost that depends on the number of titles printed. (A specific book that is to be printed is called a "title". Typically, thousands of copies will be printed of each title. Specific steps must be taken to setup the presses for printing each title-for example, changing the printing plates. The costs of these steps are the press setup costs.) Required: Estimate the variable cost per title printed and the fixed cost per month using the least-squares regression method. (Round the "Variable cost" to 2 decimal places and the "Fixed cost" to the nearest dollar amount.) Variable cost per title printed per month Fixed cost

Answer 1

Regression Equation Y= $ 38.62 X+$1991.57 a) Varaible Cost b) Fixed Cost 38.62 1992

From Regression Statistics

X- Variable = Variable cost Per Unit

Interecept = Fixed cost

SUMMARY OUTPUT Regression Statistics Multiple R R Square Adjusted R Square Standard Error Observations 0.921879 0.849861 0.824838 110.8716 ANOVA Regression Residual Total 1 6 7 417490.9 73755.01 491 Intercept X Variable 1 Coefficient: Standard E 1992 239.3303 38.62! 6.627323