Assessment #1 Cost Classification Inventory valuation PART 2 The Angla Ruston University operates a Laundromat, solely for the purpose of providing laundering services to students in residence. You have been hired as accounting students to analyze the cost of the laundering services and develop a cost function which describes the behaviour of the laundering costs. The university administration has assembled the data for a twelve-month period pertaining to the monthly total costs of providing the service and the corresponding number of students who used the laundering facilities each month. You were recently taught how to use the Excel graphing tool and a member of the team successfully generated the scattergram given below from the data set provided. Total Laundering Costs 300,000 250,000 200,000 150,000 100,000 50,000 0 0 ANGLA RUSTON UNIVERSITY SCATTER DIAGRAM 500 1,000 1,500 Line of Best Fit # of Students Laundering 2,000 2,500 3,000 The other team members are now tasked to use the graph to provide the administrators with a detailed response to the following questions: a) What is another name for the "line of best fit" in Excel? What is the purpose of this line? b) Using the "line of best fit", determine Angla Ruston University's fixed cost per month and the variable cost per student. (Use 0 & 2,500 students.) c) Based on the scatter gram, what is the equation of the total mixed cost function?
Assessment #1 Cost Classification Inventory valuation PART 2 The Angla Ruston University operates a Laundromat, solely for the purpose of providing laundering services to students in residence. You have been hired as accounting students to analyze the cost of the laundering services and develop a cost function which describes the behaviour of the laundering costs. The university administration has assembled the data for a twelve-month period pertaining to the monthly total costs of providing the service and the corresponding number of students who used the laundering facilities each month. You were recently taught how to use the Excel graphing tool and a member of the team successfully generated the scattergram given below from the data set provided. Total Laundering Costs 300,000 250,000 200,000 150,000 100,000 50,000 0 0 ANGLA RUSTON UNIVERSITY SCATTER DIAGRAM 500 1,000 1,500 Line of Best Fit # of Students Laundering 2,000 2,500 3,000 The other team members are now tasked to use the graph to provide the administrators with a detailed response to the following questions: a) What is another name for the "line of best fit" in Excel? What is the purpose of this line? b) Using the "line of best fit", determine Angla Ruston University's fixed cost per month and the variable cost per student. (Use 0 & 2,500 students.) c) Based on the scatter gram, what is the equation of the total mixed cost function?
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:Assessment #1 Cost Classification Inventory valuation
PART 2
The Angla Ruston University operates a Laundromat, solely for the purpose of providing laundering services to
students in residence. You have been hired as accounting students to analyze the cost of the laundering services
and develop a cost function which describes the behaviour of the laundering costs.
The university administration has assembled the data for a twelve-month period pertaining to the monthly total
costs of providing the service and the corresponding number of students who used the laundering facilities each
month. You were recently taught how to use the Excel graphing tool and a member of the team successfully
generated the scattergram given below from the data set provided.
Total Laundering Costs
300,000
250,000
200,000
150,000
100,000
50,000
0
0
ANGLA RUSTON UNIVERSITY SCATTER DIAGRAM
500
1,000
1,500
Line of Best Fit
# of Students Laundering
2,000
2,500
3,000
The other team members are now tasked to use the graph to provide the administrators with a detailed response
to the following questions:
a) What is another name for the "line of best fit" in Excel? What is the purpose of this line?
b) Using the "line of best fit", determine Angla Ruston University's fixed cost per month and the variable cost
per student. (Use 0 & 2,500 students.)
c) Based on the scatter gram, what is the equation of the total mixed cost function?
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