Nation's Capital Fitness, Incorporated, operates a chain of fitness centers in the Washington, D.C., area. The firm's controller is accumulating data to be used in preparing its annual profit plan for the coming year. The cost behavior p of the firm's equipment maintenance costs must be determined. The accounting staff has suggested the use of an equation, in the form of Y= a + bx, for maintenance costs. Data regarding the maintenance hours and costs for last y are as follows: Month January February March April May June July August September October November December Total Average Hours of Maintenance Service 540 470 Monthly maintenance cost = 250 500 340 480 320 420 470 370 390 330 4,880 407 Maintenance Costs $ 5,060 4,210 2,740 4,260 3,050 4,180 3,030 3,510 3,980 3,200 3,200 3,090 $ 43,510 $ 3,626 PR 6-38 (Algo) Part 1 Estimate the behavior of the maintenance costs incurred... Required: 1. Using the high-low method of cost estimation, estimate the behavior of the maintenance cpsts incurred by Nation's Capital Fit Incorporated. Express the cost behavior pattern in equation form. Note: Round coefficient of X to 2 decimal places and other answer to the nearest whole dollar amount.
Nation's Capital Fitness, Incorporated, operates a chain of fitness centers in the Washington, D.C., area. The firm's controller is accumulating data to be used in preparing its annual profit plan for the coming year. The cost behavior p of the firm's equipment maintenance costs must be determined. The accounting staff has suggested the use of an equation, in the form of Y= a + bx, for maintenance costs. Data regarding the maintenance hours and costs for last y are as follows: Month January February March April May June July August September October November December Total Average Hours of Maintenance Service 540 470 Monthly maintenance cost = 250 500 340 480 320 420 470 370 390 330 4,880 407 Maintenance Costs $ 5,060 4,210 2,740 4,260 3,050 4,180 3,030 3,510 3,980 3,200 3,200 3,090 $ 43,510 $ 3,626 PR 6-38 (Algo) Part 1 Estimate the behavior of the maintenance costs incurred... Required: 1. Using the high-low method of cost estimation, estimate the behavior of the maintenance cpsts incurred by Nation's Capital Fit Incorporated. Express the cost behavior pattern in equation form. Note: Round coefficient of X to 2 decimal places and other answer to the nearest whole dollar amount.
Chapter2: Building Blocks Of Managerial Accounting
Section: Chapter Questions
Problem 9EA: The cost data for Evencoat Paint for the year 2019 is as follows: Using the high-low method, express...
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Nation's Capital Fitness, Incorporated, operates a chain of fitness centers in the Washington, D.C., area. The firm's
controller is accumulating data to be used in preparing its annual profit plan for the coming year. The cost behavior patte
of the firm's equipment maintenance costs must be determined. The accounting staff has suggested the use of an
equation, in the form of Y= a +bX, for maintenance costs. Data regarding the maintenance hours and costs for last year
are as follows:
Month
January
February
March
April
May
June
July
August
September
October
November
December
Total
Average
Hours of
Maintenance
Service
Monthly maintenance cost=
540
470
250
500
340
480
320
420
470
370
390
330
4,880
407
Maintenance
Costs
$ 5,060
4,210
2,740
4,260
3,050
4,180
3,030
3,510
3,980
3,200
3,200
3,090
$43,510.
$3,626
PR 6-38 (Algo) Part 1 Estimate the behavior of the maintenance costs incurred...
Required:
1. Using the high-low method of cost estimation, estimate the behavior of the maintenance cpsts incurred by Nation's Capital Fitnes
Incorporated. Express the cost behavior pattern in equation form.
Note: Round coefficient of X to 2 decimal places and other answer to the nearest whole dollar amount.
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