[The followinginformation applies to the questions displayed below.]
Caiman DistributionPartners is the Brazilian distribution company of a U.S. consumerproducts firm. Inflation in Brazil has made bidding and budgetingdifficult for marketing managers trying to penetrate some of thecountry's rural regions. The company expects to distribute 450,000cases of products in Brazil next month. The controller hasclassified operating costs (excluding costs of the distributedproduct) as follows:
| Account | Operating Cost | Behavior |
| Supplies | $ | 1,231,000 | | Allvariable |
| Supervision | | 203,000 | | $ | 141,000 | Fixed |
| Truckexpense | | 1,270,000 | | $ | 178,000 | Fixed |
| Buildingleases | | 865,000 | | $ | 548,000 | Fixed |
| Utilities | | 200,000 | | $ | 115,000 | Fixed |
| Warehouselabor | | 845,000 | | $ | 139,000 | Fixed |
| Equipmentleases | | 777,000 | | $ | 582,000 | Fixed |
| Data processingequipment | | 955,000 | | All fixed |
| Other | | 838,000 | | $ | 386,000 | Fixed |
| Total | $ | 7,184,000 | | | | |
|
Although overheadcosts were related to revenues throughout the company, theexperience in Brazil suggested to the managers that they shouldincorporate information from a published index of Brazilian pricesin the distribution sector to forecast overhead in a manner morelikely to capture the economics of the business.
Following instructionsfrom the corporate offices, the controller's office in Brazilcollected the following information for monthly operations fromlast year:
| Month | Cases | PriceIndex | Operating Costs |
| 1 | 229,000 | 115 | $5,699,161 | |
| 2 | 324,000 | 123 | 5,806,660 | |
| 3 | 230,000 | 121 | 5,849,927 | |
| 4 | 384,000 | 132 | 5,927,639 | |
| 5 | 308,000 | 112 | 5,939,157 | |
| 6 | 361,000 | 132 | 6,043,386 | |
| 7 | 361,000 | 123 | 5,918,517 | |
| 8 | 455,000 | 127 | 6,133,890 | |
| 9 | 359,000 | 131 | 6,126,152 | |
| 10 | 432,000 | 132 | 6,186,647 | |
| 11 | 376,000 | 136 | 6,208,821 | |
| 12 | 456,000 | 140 | 6,362,277 | |
|
These data areconsidered representative for both past and future operations inBrazil.
Determine the variablecost per case assuming that 450,000 cases will be shipped nextmonth based on the controller's analysis of accounts. (round youranswer to 2 decimal places).
VARIABLE COST PER CASE_______?_____
Prepare an estimate ofoperating costs
ESTIMATE OF OPERATINGCOST _________?_________
Use the high-lowmethod to compute an estimate of operating costs assumingthat,450,000 cases will be shipped next month. (Round variable costto 5 decimal places. Round
intermediate calculations and final answer to the nearest wholedollar amount).
ESTIMATE OF OPERATINGCOST _____?__________
Enter the regressioncoefficients. (Round "Cases" to 5 decimal places.)
INTERCEPT_____?______
CASES ____?_______
Compute the estimationof operating costs assuming that 450,000 cases will be shipped nextmonth by using the results of a simple regression
of operating costs on cases shipped. (Round variable costs per unitto 5 decimal places. Round the intercept and final answer to thenearest
whole dollar amount)
ESTIMATE OF OPERATINGCOST _____?___________
Enter the regressioncoefficients. (Round "Cases" to 5 decimal places and "Price Index"to 5 decimal places.)
INTERCEPT _______?__________
CASES _______?__________
PRICE INDEX _________?________
Compute the estimationof operating costs assuming that 450,000 cases will be shipped nextmonth by using the results of a multiple regression
of operating costs on cases shipped and the price level. Assume aprice level of 146 for next month. (Round "Cases" and "Price Index"to 5 decimals
places. Round the final answer to the nearest whole dollaramount.
ESTIMATE OF OPERATINGCOST ________?______________
