Question

Leslie Sporting Goods is a locally owned store that specializes in printing team jerseys. The majority of its business comes from orders for various local teams and organizations. While Leslie’s prints everything from bowling team jerseys to fraternity/sorority apparel to special event shirts, summer league baseball and softball team jerseys are the company’s biggest source of revenue.

A portion of Leslie’s operating information for the company’s last year follows:

Month	Number of Jerseys Printed	Operating Cost
January	215	$5,830
February	210	5,785
March	235	5,945
April	550	8,640
May	685	9,755
June	615	9,290
July	450	6,245
August	365	6,175
September	325	6,045
October	245	5,965
November	190	4,990
December	185	4,890

Required:
3. Using the high-low method, calculate the store’s total fixed operating costs and variable operating cost per jersey. (Do not round your intermediate calculations. Round your "Variable Cost" answer to 2 decimal places and "Fixed Cost" answer to the nearest whole number.)

  
4. Using the high-low method results, calculate the store’s expected operating cost if it printed 440 jerseys. (Do not round your intermediate calculations. Round your answer to the nearest whole number.)

   

5. Perform a least-squares regression analysis on Leslie’s data. (Use Microsoft Excel or a statistical package to find the coefficients using least-squares regression. Round your answers to 2 decimal places.)


  
6. Using the regression output, create a linear equation (y = a + bx) for estimating Leslie’s operating costs. (Round your answers to 2 decimal places.)



7. Using the least-squares regression results, calculate the store’s expected operating cost if it prints 650 jerseys. (Round your intermediate calculations to 2 decimal places. Round your final answer to 2 decimal places.)

Answer 1