Java Joe coffees wants to find an equation to estimate monthly utility costs. Java Joe's has been in business for one year and has collected the following cost data for utilities 1.which of the preceding costs is variable? Fixed? Mixed? Explain 2. using the high-low method, determine the cost function for each cost 3. combine the preceding information to get a monthly utility cost function for Java 4. next month, Java's expects to use 2200 kilowatt hours of electricity, make 1500 minutes of telephone calls and use 32000 gallons of water. Estimate total cost of utilities for the month Month Electricity bill Kilowatt hours used telefone telefone min used Water bill Gallons of water used January $360 1200 $92.00 1100 $60 30560 February $420 1400 $91.80 1060 $60 26800 March $549 1830 $94.80 1240 $60 31450 April $405 1350 $89.60 980 $60 29965 May $588 1960 $98.00 1400 $60 30568 June $624 2080 $98.80 1440 $60 25540 July $522 1740 $93.40 1170 $60 32690 August $597 1990 $96.20 1310 $60 31222 September $630 2100 $95.60 1280 $60 33540 October $615 2050 $93.80 1190 $60 31970 November $594 1980 $91.00 1050 $60 28600 December $633 2110 $97.00 1350 $60 34100

Excel Applications for Accounting Principles

4th Edition

ISBN:9781111581565

Author:Gaylord N. Smith

Publisher:Gaylord N. Smith

ChapterMB: Model-building Problems

Section: Chapter Questions

Problem 18M

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Java Joe coffees wants to find an equation to estimate monthly utility costs. Java Joe's has been in business for one year and has collected the following cost data for utilities

1.which of the preceding costs is variable? Fixed? Mixed? Explain

2. using the high-low method, determine the cost function for each cost

3. combine the preceding information to get a monthly utility cost function for Java

4. next month, Java's expects to use 2200 kilowatt hours of electricity, make 1500 minutes of telephone calls and use 32000 gallons of water. Estimate total cost of utilities for the month

Month	Electricity bill	Kilowatt hours used	telefone	telefone min used	Water bill	Gallons of water used
January	$360	1200	$92.00	1100	$60	30560
February	$420	1400	$91.80	1060	$60	26800
March	$549	1830	$94.80	1240	$60	31450
April	$405	1350	$89.60	980	$60	29965
May	$588	1960	$98.00	1400	$60	30568
June	$624	2080	$98.80	1440	$60	25540
July	$522	1740	$93.40	1170	$60	32690
August	$597	1990	$96.20	1310	$60	31222
September	$630	2100	$95.60	1280	$60	33540
October	$615	2050	$93.80	1190	$60	31970
November	$594	1980	$91.00	1050	$60	28600
December	$633	2110	$97.00	1350	$60	34100

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