Polar Bear Ski Wear is a shop that sells skiwear at a ski resort. Its cost accountant developed the following scatter plot for the cost of electricity for lights, heating, and cooling against retail sales revenue.

A. In a business such as retail sales, what usually causes the cost of electricity to vary?
B. In what time of year would most skiwear be sold at a ski resort?
C. In the scatter plot, the cost of electricity appears to be related to volume of retail sales. If this shop specialized in selling swimwear, would the scatter plot look different? Explain what would change.
D. Identify and explain another cost that is similar in nature to the cost of electricity. When you plot the cost against a cost driver, a relationship becomes apparent. However, the cost varies with something other than the cost driver. (Think of other situations where this type of relationship mightoccur.)

  • CreatedJanuary 26, 2015
  • Files Included
Post your question