Question

Autodesk Corporation produces toolboxes used by construction professionals and homeowners. The company is concerned that it does not have an understanding of its utility consumption. The company’s president, George, has asked the plant manager and cost accountant to work together to get information about utilities cost. The two of them accumulated the following data for the past 14 months (production volume is presented in units):


Required
A. Using the high/low method, what is the company’s utility cost equation?
B. What would be the expected utility cost of producing 120,000 units? (The relevant range is 85,000 to 125,000 units of production.)
C. Using the data shown and a spreadsheet program, perform a regression analysis. Discuss any differences in the results and the potential impact on decisionmaking.


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  • CreatedMarch 11, 2015
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