ETutor Is an Online Tutoring Service Provider That Is Particularly

question 103

Essay

ETutor is an online tutoring service provider that is particularly popular with college students.The company is interested in estimating the fixed and variable components of its tutoring services costs.The manager believes that these costs are driven by the number of hours of tutoring services provided.The following information was gathered for the last six months of business: $$\begin{array} { | l | r | r | } \hline \text { Month } & \text { Number of Hours } & \text { Tutoring costs } \\\hline \text { January } & 25,000 & \$ 308,000 \\\hline \text { February } & 41,000 & 420,000 \\\hline \text { March } & 29,000 & 352,000 \\\hline \text { April } & 31,000 & 373,000 \\\hline \text { May } & 34,000 & 378,000 \\\hline \text { June } & 18,000 & 252,000 \\\hline\end{array}$$ Required:
1)Compute the average tutoring cost per hour for the six-month period.(Round the average tutoring cost per hour to two decimal points. )
2)Use the high-low method to estimate the total fixed cost and the variable cost per hour.(Round the variable cost per hour to two decimal points. )
3)Name one advantage and one disadvantage of the high-low method.
4)Describe the scattergraph method that can be used to analyze mixed costs.

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Definitions:

Collective Unconscious

A concept in analytical psychology referring to the part of the unconscious mind which is derived from ancestral memory and experience common to all humankind.

Archetypes

Fundamental, universal symbols or themes that recur in myths, literature, and dreams reflecting the collective unconscious.

Psychosexual Stage

A concept in Freudian psychology that describes phases of childhood development, each characterized by an erogenous zone that drives behavior.

Oral

Pertaining to the mouth; often used to describe medications or other substances that are taken by mouth.