Nation's Capital Fitness, Incorporated, operates a chain of fitness centers in the Washington, D.C., area. The firm'scontroller is accumulating data to be used in preparing its annual profit plan for the coming year. The cost behavior patternof the firm's equipment maintenance costs must be determined. The accounting staff has suggested the use of anequation, in the form of Y= a + bX, for maintenance costs. Data regarding the maintenance hours and costs for last yearare as follows:MonthJanuaryFebruaryMarchAprilMayJuneJulyAugustSeptemberOctoberNovemberDecemberTotalAverageHours ofMaintenanceServiceVariable maintenance cost5604802804703504603204304903803503404,910409$MaintenanceCosts$ 5,1104,2402,7304,3003,0304, 120PR 6-38 (Algo) Part 2 What is the variable component of the maintenance cost?2. Using your answer to requirement 1, what is the variable component of the maintenance cost?Note: Round your answer to 2 decimal places.3,0003,5904,0003,2203,1703,070$ 43,580$ 3,6328.00 per hour

Variable component of maintenance costs : Variable maintenance costs change with the productivity…

Ontroller is accumulating data to be used in preparing its annual profit plan fc f the firm's equipment maintenance costs must be determined. The accounti quation, in the form of Y= a + bx, for maintenance costs. Data regarding the re as follows:

Ontroller is accumulating data to be used in preparing its annual profit plan fc f the firm's equipment maintenance costs must be determined. The accounti quation, in the form of Y= a + bx, for maintenance costs. Data regarding the re as follows:

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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