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student no. 0364863

Part 2 (Chapter 3 content) (15 Marks) Stella Services has a customer website to take orders, answer customer questions, and address customer complaints. The costs associated with this customer website over the past six months are listed below: Month Customer website costs Number of website hits January $15,000 9,000 February $15.400 March $16.000 plus last digit of student number 10,200 plus last digit of student number April $15.950 9.700 May $14,500 minus last digit of student number 8,200 minus last digit of student number June $14,800 8,800 9,200 Management at Stella Services believes that the customer website costs are a mixed cost and would like to use the high-low method to estimate their future costs using the number of website hits in any given month as the cost driver. Required: 1. Using the high-low method, estimate the variable cost per website hit and the monthly fixed costs associated with the customer website. (Part 2 is continued on the next page). Page 3 of 7 2. Write the cost equation for estimating the customer website expenses for Stella Services using the results from Requirement 1. 3. If Stella Services expects 9,500 website hits for July, what are their anticipated customer website costs for July