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r20Q-1.pdr QU ESTION 2
Part a) Sukiyaki Suzuki, the financial manager at the Sushi Taichi Bar, is checking to see if there is any relationship between advertising and sales revenues of the restaurant. She obtains the following data for the past 10
months: 40 marks Month ‘ Revenues Advertisin costs Jaguar ‘ 2,000
February ‘ m i 3,0l30 ‘ mmmmmmmm.w Wise—Pewter
i OCtD her She estimates the ‘follnwing regressien equatiori: Monthly revenues 2 \$39 502 + {158.723 3 Advertising costs) Required: 1, Use the high—low n‘iethod to calculate the function, relating advertising costs
and revenues
Using: (a) the regression equatien and lb) the high—low equation, what is the increase in revenues for each \$1000 spent on advertising within the relevant
range? (10 marks) (5 marks) Which method should Anna use to predict the effect of advertising costs on
revenues? Explain hriefly (5 marks)

D Microsoft Word —ASSlG‘ X lle.uowpl-atform.edu.au/pluginfilephpﬂ2‘12592/mod_resource/conter 7 , ”WWW , MWWWWWMWUW QUESTION 3 2° &quot;'3'” Chico &amp; Co, a business adviser company, specialises in financial advisory services. Its job-costing system has
a single direct cost category (professional labour) and a single indirect cost pool (Business support, which
contains all costs of the Support Department). Business support costs are allocated to individual jobs using actual professional labour-hours. Chico 8: Co. employs 10 professionals to perform advisory services.
Budgeted and actual amounts for 2015 are as follows: Budget for 2017 - Professional labour costs S 992,000
5 .ﬂﬁmﬁﬂﬁﬁﬁmmﬁﬁﬂﬁammwm,w ........ “\$221500
Professional labour-hours billed to clients mm»... Wm“ - Actuai result for 2017 SU' .sseamspssmm..m ,,,,,,,, . 5 744,000
, Professional labour-hours biiLetluto clients ‘‘‘‘‘ _715,000
i...{mammalegaliemanseatéamsasﬂmn S , 69 ,
Required:
1. Calculate the direct cost rate and the indirect cost rate per professional labour- (6 marks) hourfor 2017 under: (3) actual costing, (b) normal costing, and (c) the variation from normal costing that uses budgeted rates for direct costs. Chico &amp; Co's 2017 advisory service of Cooma Ltd was budgeted to take 110 (6 marks)
hours of professional labour time. The actual professional labour time spent on the advisory service was 120 hours. Calculate the cost of the Cooma Ltd service using: (a) actual costing, (b) normal costing, and (c) the variation from normal
costing that uses budgeted rates for direct costs.
3‘ Explain any differences in the job cost (8 marks)

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