Pine View Hospital wants to determine the cost behavior pattern of maintenance costs for its X-ray machines. The hospital has decided to use linear regression to examine the costs. The prior year’s data regarding maintenance hours and costs are as follows:

Required
A. Perform a regression analysis on the above data. What maintenance costs should be budgeted for a month in which 430 maintenance hours will be worked?
B. What is the percentage of the total variance that can be explained by your analysis?
C. Use the high/low method to estimate a cost formula for Pine View. How similar is your high/low solution to the regressionsolution?

January February March April May une July August September October November December Hours of Activity 500 450 300 375 425 520 410 380 440 390 400 330 Maintenance Costs $3,950 3,800 3,220 3,380 3,700 4,000 3,650 3,400 3,780 3,470 3,590 3,310