Question 3 - Mixed Cost Analysis \& Relevant Ranges. The Roakes Company is interested in developing a cost equation to estimate the fixed and variable components of its monthly manufacturing overhead costs. The company wishes to use machine hours as its measure of activity and has gathered the following data: The company leases all of its manufacturing equipment. The lease arrangement calls for a flat monthly fee up to 19,500 machine hours. If the machine hours used exceeds 19,500, the monthly fee becomes strictly variable with respect to the total number of machine hours consumed during the month. Lease expense is a major element of overhead costs. Required: (a) Prepare a scatterplot using the above data. Change the x-axis range to 8,00026,000 and the y-axis range to 60.000110.000. (b) Using the high-low method, estimate the cost equation for manufacturing overhead costs using all of the data points given. The high-low method estimates the cost equation by drawing a straight line using the highest and lowest points. Do you belleve that this straight line fit the data well? Explain. (c) Based on the lease arrangement described above, divide the data points into two relevant ranges. State the two relevant ranges. Estimate the cost equation for each relevant range using the high-low method