As Part of His Job as Cost Analyst,Max Thompson Collected

question 17

Essay

As part of his job as cost analyst,Max Thompson collected the following information concerning the operations of the Machining Department:
$$\begin{array} { l c c } \text { Observation } & \text { Machine-hours } & \text { Total Operating Costs } \\\hline \text { January } & 4,700 & \$ 43,000 \\\text { February } & 5,060 & 45,395 \\\text { March } & 4,180 & 42,535 \\\text { April } & 4,500 & 43,600 \\\text { May } & 4,250 & 42,890\end{array}$$ Required:
a.Use the high-low method to determine the estimating cost function with machine-hours as the cost driver.
b.If June's estimated machine-hours are 4,300,calculate the total estimated costs of the Machining Department?

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Definitions:

Monetary Policy

The process by which a central bank or monetary authority manages money supply and interest rates to achieve macroeconomic objectives like controlling inflation, consumption, growth, and liquidity.

Deregulation

Deregulation is the process of removing or reducing government restrictions and regulations in industries to encourage more competition and efficiency.

Regulatory Capture

A situation where regulatory agencies are dominated by the very industries they are charged with regulating, leading to favorable outcomes for the industry.

Regulatory Agency

An agency, commission, or board established by the federal government or a state government to control the prices charged and the services offered by a natural monopoly or public utility.