Ch 5 P5-8, p5-14 (1)

# Ch 5 P5-8, p5-14 (1) - 90 \$2,900 Apr 120 \$3,300 May 100...

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Occupancy Custodial Month Days Costs Mar 4000 \$7,500 Apr 6500 \$8,250 May 8000 \$10,500 Jun 10500 \$12,000 Jul 12000 \$13,500 Aug 9000 \$10,750 Sep 7500 \$9,750 intercept \$3,973 slope \$0.77 RSQ 96.23% high correlation Hi/Lo Method : y = A + b(x) Step 1 - Find VC /unit (b) Occ days Elec Cost Hi pt 12000 \$13,500 Lo pt 4000 \$7,500 Change 8000 \$6,000 \$0.7500 y (elec cost) = A ( fixed component) + b (VC/unit) Hi pt \$13,500 A ( fixed component) + \$0.7500 \$13,500 A ( fixed component) + \$9,000 Solve for A \$4,500 Hi/Lo Method Cost Equation: y = \$4500 + \$0.75(x) y (elec cost) = A ( fixed component) + b (VC/unit) LO pt y = \$4,500 + \$0.7500 y = \$4,500 + \$3,000 Solve for y \$7,500 3000 400 \$- \$2,000 \$4,000 \$6,000 \$8,000 \$10,000 \$12,000 \$14,000 \$16,000 Custodial Costs

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x (occup days) 12000 x (occup days) 4,000 00 5000 6000 7000 8000 9000 10000 11000 12000 13000 Column C Occupancy Days
Scans Utility Month Taken Cost Jan 60 \$2,200 Feb 70 \$2,600 Mar

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Unformatted text preview: 90 \$2,900 Apr 120 \$3,300 May 100 \$3,000 Jun 130 \$3,600 Jul 150 \$4,000 Aug 140 \$3,600 Sep 110 \$3,100 Oct 80 \$2,500 intercept \$1,171 slope \$18.18 RSQ 96.85% high correlation Hi/Lo Method : y = A + b(x) Step 1 - Find VC /unit (b) Scans Utility Cost Hi pt 150 \$4,000 Lo pt 60 \$2,200 Change 90 \$1,800 \$20.0000 Step 2 - Substitute value of b into formula & solve for A y (Utility Cost) = A ( fixed component) + b (VC/unit) Hi pt \$4,000 A ( fixed component) + \$20.0000 \$4,000 A ( fixed component) + \$3,000 Solve for A \$1,000 Hi/Lo Method Cost Equation: y = \$1000 + \$20.00(x) Step 3 - Test values of b & A by substituting into Lo point formula y (Utility Cost) = A ( fixed component) + b (VC/unit) LO pt y = \$1,000 + \$20.0000 y = \$1,000 + \$1,200 Solve for y \$2,200 40 \$- \$500 \$1,000 \$1,500 \$2,000 \$2,500 \$3,000 \$3,500 \$4,000 \$4,500 Utility Cost x (SCANS) 150 x (SCANS) 60 60 80 100 120 140 160 Column C ScansTaken...
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Ch 5 P5-8, p5-14 (1) - 90 \$2,900 Apr 120 \$3,300 May 100...

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