Cost Estimation, Interpretation, and Analysis Kendrick Anderson Furniture Maker, LLC creates custom tables in Atlanta. Assume that the following represents monthly information (also included at this link) on production volume and manufacturing costs since the company started operations. Dining Total Room Tables Manufacturing Month Total Tables Living Room Produced Tables Produced Produced Costs June July 110 4 25 85 $71,000 90 45 45 57,500 August 130 15 115 79,724 September 95 36 59 64,250 October 76 24 52 57,300 November 92 48 44 60,900 December 105 24 81 62,700 January 110 50 60 70,130 February 102 20 82 68,400 March 81 25 56 57,400 April 142 102 40 105,790 May 125 22 103 74,750 June 115 15 100 74,290 July 106 18 88 66,500 August 85 28 57 49,888 September 116 55 61 72,668 October 120 81 39 71,700 November 120 30 90 74,200 December 72 18 54 54,900 Required 自

Managerial Accounting: The Cornerstone of Business Decision-Making
7th Edition
ISBN:9781337115773
Author:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger
Publisher:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger
Chapter3: Cost Behavior And Cost Forecasting
Section: Chapter Questions
Problem 60P: Scattergraph, High-Low Method, and Predicting Cost for a Different Time Period from the One Used to...
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Use the high-low method to develop a cost estimating equation for total manufacturing costs driven by total tables produced.
The answer is Y=$2,556 + $727 x

c. Excluding any unusual observations, use the high-low method to develop a cost-estimating equation for total manufacturing costs Comment on the results comparing them with (a). 
 
Using the image, What is the Cost estimating equation? 

Cost Estimation, Interpretation, and Analysis
Kendrick Anderson Furniture Maker, LLC creates custom tables in Atlanta. Assume that the following represents monthly information (also included at this link) on production volume and manufacturing costs
since the company started operations.
Dining
Total
Room Tables Manufacturing
Month
Total
Tables
Living Room
Produced
Tables
Produced
Produced
Costs
June
July
110
4
25
85
$71,000
90
45
45
57,500
August
130
15
115
79,724
September
95
36
59
64,250
October
76
24
52
57,300
November
92
48
44
60,900
December
105
24
81
62,700
January
110
50
60
70,130
February
102
20
82
68,400
March
81
25
56
57,400
April
142
102
40
105,790
May
125
22
103
74,750
June
115
15
100
74,290
July
106
18
88
66,500
August
85
28
57
49,888
September
116
55
61
72,668
October
120
81
39
71,700
November
120
30
90
74,200
December
72
18
54
54,900
Required
自
Transcribed Image Text:Cost Estimation, Interpretation, and Analysis Kendrick Anderson Furniture Maker, LLC creates custom tables in Atlanta. Assume that the following represents monthly information (also included at this link) on production volume and manufacturing costs since the company started operations. Dining Total Room Tables Manufacturing Month Total Tables Living Room Produced Tables Produced Produced Costs June July 110 4 25 85 $71,000 90 45 45 57,500 August 130 15 115 79,724 September 95 36 59 64,250 October 76 24 52 57,300 November 92 48 44 60,900 December 105 24 81 62,700 January 110 50 60 70,130 February 102 20 82 68,400 March 81 25 56 57,400 April 142 102 40 105,790 May 125 22 103 74,750 June 115 15 100 74,290 July 106 18 88 66,500 August 85 28 57 49,888 September 116 55 61 72,668 October 120 81 39 71,700 November 120 30 90 74,200 December 72 18 54 54,900 Required 自
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