The data below have been taken from the cost records of the Halifax General Hospital. The...
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The data below have been taken from the cost records of the Halifax General Hospital. The data relate to the costs of admitting patients at various levels of patient activity: 1. 2. 3. Month 4. May......... June Requirements: Using the high-low method, and based upon the data collected: (a) estimate the variable cost per admission. July............ August .......... September...... October............. November.......... December...... *********** Number of Patients Admitted 3,600 3,800 2,900 3,200 3,300 2,600 2,200 3,500 Admitting Department Costs $ 29,400 $ 28,700 $ 27,400 $ 28,000 $ 28,600 $ 26,200 $ 25,600 $ 29,300 (b) estimate the fixed costs for admission. (c) estimate the cost formula for admissions (cost formula is in the format of Y = a + bx). Using the cost formula you derived above, what admission costs would you expect to be incurred during a month in which there are 2,750 hospital admissions? Prepare a scattergraph plot using the data. Plot cost on the vertical axis and activity on the horizontal axis. Add the visual best-fit "trendline" to fit a line through the points on your scattergraph. Also add the "high-low trendline" so that you can compare the two trendlines and the data set points in Requirement 4. (Hint: You can either use software, such as Microsoft Excel, or Google Sheets, or draw the scattergraph plot on your computer using a drawing program (Microsoft Paint, or similar) or you can draw and plot the points on a piece of paper by hand and take a picture and insert the picture into your document.) Scrutinize the points on your scattergraph, and explain why the high-low method would or would not yield an accurate cost formula in this situation. The data below have been taken from the cost records of the Halifax General Hospital. The data relate to the costs of admitting patients at various levels of patient activity: 1. 2. 3. Month 4. May......... June Requirements: Using the high-low method, and based upon the data collected: (a) estimate the variable cost per admission. July............ August .......... September...... October............. November.......... December...... *********** Number of Patients Admitted 3,600 3,800 2,900 3,200 3,300 2,600 2,200 3,500 Admitting Department Costs $ 29,400 $ 28,700 $ 27,400 $ 28,000 $ 28,600 $ 26,200 $ 25,600 $ 29,300 (b) estimate the fixed costs for admission. (c) estimate the cost formula for admissions (cost formula is in the format of Y = a + bx). Using the cost formula you derived above, what admission costs would you expect to be incurred during a month in which there are 2,750 hospital admissions? Prepare a scattergraph plot using the data. Plot cost on the vertical axis and activity on the horizontal axis. Add the visual best-fit "trendline" to fit a line through the points on your scattergraph. Also add the "high-low trendline" so that you can compare the two trendlines and the data set points in Requirement 4. (Hint: You can either use software, such as Microsoft Excel, or Google Sheets, or draw the scattergraph plot on your computer using a drawing program (Microsoft Paint, or similar) or you can draw and plot the points on a piece of paper by hand and take a picture and insert the picture into your document.) Scrutinize the points on your scattergraph, and explain why the high-low method would or would not yield an accurate cost formula in this situation.
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1 a To Estimate the variable cost per admission and fixed costs using the highlow method we need to determine the highest and lowest number of patient... View the full answer
Related Book For
A Survey of Mathematics with Applications
ISBN: 978-0134112107
10th edition
Authors: Allen R. Angel, Christine D. Abbott, Dennis Runde
Posted Date:
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