! Required information [The following information applies to the questions displayed below.] Bargain Rental Car offers rental cars in an off-airport location near a major tourist destination in California. Management would like to better understand the variable and fixed portions of its car washing costs. The company operates its own car wash facility in which each rental car that is returned is thoroughly cleaned before being released for rental to another customer. Management believes that the variable portion of its car washing costs relates to the number of rental returns. Accordingly, the following data have been compiled: Month Rental Returns Car Wash Costs January 2,500 $ 12,100 February 2,600 $ 13,700 March 2,800 $ 12,900 April 3,200 $ 15,900 May 3,700 $ 17,300 June 5,300 $ 25,500 July 5,600 $ 23,300 August 5,800 $ 24,900 September 4,800 $ 23,900 October 5,200 $ 24,400 November December 2,300 $ 11,800 3,200 $ 18,100 2. Using least-squares regression, estimate the variable cost per rental return and the monthly fixed cost incurred to wash cars. (Round Fixed cost to the nearest whole dollar amount and the Variable cost per unit to 2 decimal places.) Answer is complete but not entirely correct. Fixed cost per month $ 24X $ Variable cost per rental return 16,729.00
! Required information [The following information applies to the questions displayed below.] Bargain Rental Car offers rental cars in an off-airport location near a major tourist destination in California. Management would like to better understand the variable and fixed portions of its car washing costs. The company operates its own car wash facility in which each rental car that is returned is thoroughly cleaned before being released for rental to another customer. Management believes that the variable portion of its car washing costs relates to the number of rental returns. Accordingly, the following data have been compiled: Month Rental Returns Car Wash Costs January 2,500 $ 12,100 February 2,600 $ 13,700 March 2,800 $ 12,900 April 3,200 $ 15,900 May 3,700 $ 17,300 June 5,300 $ 25,500 July 5,600 $ 23,300 August 5,800 $ 24,900 September 4,800 $ 23,900 October 5,200 $ 24,400 November December 2,300 $ 11,800 3,200 $ 18,100 2. Using least-squares regression, estimate the variable cost per rental return and the monthly fixed cost incurred to wash cars. (Round Fixed cost to the nearest whole dollar amount and the Variable cost per unit to 2 decimal places.) Answer is complete but not entirely correct. Fixed cost per month $ 24X $ Variable cost per rental return 16,729.00
Chapter9: Responsibility Accounting And Decentralization
Section: Chapter Questions
Problem 5EB: Assume you are the warehouse manager for Vinnies Vinyls, a multi-location business specializing in...
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