Using data from the regression analysis, develop the following cost estimates per person for a cocktail party. Assume that the level

of activity remains within the relevant range.

Rand has been asked to prepare a bid for a $290-$person cocktail party to be given next month. Determine the minimum bid price

that Rand should be willing to submit.

What other factors should Rand consider in developing the bid price for the cocktail party?

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Required $2$

Using data from the regression analysis, develop the following cost estimates per person for a cocktail party. Assume that the

level of activity remains within the relevant range.

Note: Round intermediate calculations and final answers to $2$ decimal places.

Required information

Dana Rand owns a catering company that prepares banquets and parties for both individual and business functions

throughout the year. Rand's business is seasonal, with a heavy schedule during the summer months and the year$-$

end holidays and a light schedule at other times. During peak periods, there are extra costs; however, even during

nonpeak periods Rand must work more to cover expenses.

One of the major events customers request is a cocktail party. Rand offers a standard cocktail party and has

developed the following cost structure on a per$-$person basis.

When bidding on cocktail parties, Rand adds a $10$ percent markup to this cost structure as a profit margin. Rand is

quite certain about estimates of the prime costs but is not as comfortable with the overhead estimate. This estimate

was based on the actual data for the past $12$ months presented in the following table. These data indicate that

overhead expenses vary with the direct$-$labor hours expended. The $$12$ estimate was determined by dividing total

overhead expended for the $12$ months $($$$797,000)$ by total labor hours $(65,300)$ and rounding to the nearest dollar.

Rand recently attended a meeting of the local chamber of commerce and heard a business consultant discuss

regression analysis and its business applications. After the meeting, Rand decided to do a regression analysis of the

overhead data. The following $($rounded$)$ results were obtained.

Intercept $($a$)$

Coefficient $($b$)$