Lorenzo operates a brushless car wash. Incoming cars are put onan automatic, continuously moving conveyor belt. A car is washed asthe conveyor belt carries it from the start station to the finishstation. After the car moves off the conveyor belt, workers dry itand clean and vacuum the inside. Workers are managed by a singlesupervisor. Lorenzo's accountant wants to estimate total costs inOctober, when 10,500 cars are expected to be washed. She uses twodifferent methods to estimate total October costs, account analysisand high-low, with number of cars washed as the independentvariable for both methods. For the account analysis method, shedeveloped cost function parameter estimates by analyzing actualcosts in June, when 9,600 cars were washed. The following are Junetotal costs and her variable cost estimates:
Cost Item Total Cost
Variable Portion
Soap, cloths, and supplies $5,760
$5,760
Water $4,800
$4,800
Car wash labor $26,910
$24,000
Power for conveyor $10,360
$7,680
Supervisor and cashier $3,000
$0
For the high-low method, she developed cost function parameterestimates by using the actual costs in April and May, when 8,600and 11,300 cars were washed, respectively. The following are totalcosts for these two months:
Cost Item April
May
Soap, cloths, and supplies $5,160
$6,780
Water $1,720
$2,260
Car wash labor $26,220
$33,510
Power for conveyor $9,180
$11,340
Supervisor and cashier $3,400
$3,400
REQUIRED [ROUND PER-UNIT COSTS TO TWO DECIMAL PLACES AND TOTALCOSTS TO THE NEAREST DOLLAR.]
Part A (6 tries; 5 points)
1. Using account analysis, what is the accountant's estimate oftotal fixed costs for October?
2. Using account analysis, what is the accountant's estimate ofvariable costs per unit for October?
Part B (6 tries; 5 points)
1. Using the high-low method, what is the accountant's estimate oftotal fixed costs for October?
2. Using the high-low method, what is the accountant's estimate oftotal variable costs for October?
Lorenzo operates a brushless car wash. Incoming cars are put onan automatic, continuously moving conveyor belt. A car is washed asthe conveyor belt carries it from the start station to the finishstation. After the car moves off the conveyor belt, workers dry itand clean and vacuum the inside. Workers are managed by a singlesupervisor. Lorenzo's accountant wants to estimate total costs inOctober, when 10,500 cars are expected to be washed. She uses twodifferent methods to estimate total October costs, account analysisand high-low, with number of cars washed as the independentvariable for both methods. For the account analysis method, shedeveloped cost function parameter estimates by analyzing actualcosts in June, when 9,600 cars were washed. The following are Junetotal costs and her variable cost estimates:
| Cost Item | Total Cost | Variable Portion |
| Soap, cloths, and supplies | $5,760 | $5,760 |
| Water | $4,800 | $4,800 |
| Car wash labor | $26,910 | $24,000 |
| Power for conveyor | $10,360 | $7,680 |
| Supervisor and cashier | $3,000 | $0 |
For the high-low method, she developed cost function parameterestimates by using the actual costs in April and May, when 8,600and 11,300 cars were washed, respectively. The following are totalcosts for these two months:
| Cost Item | April | May |
| Soap, cloths, and supplies | $5,160 | $6,780 |
| Water | $1,720 | $2,260 |
| Car wash labor | $26,220 | $33,510 |
| Power for conveyor | $9,180 | $11,340 |
| Supervisor and cashier | $3,400 | $3,400 |
REQUIRED [ROUND PER-UNIT COSTS TO TWO DECIMAL PLACES AND TOTALCOSTS TO THE NEAREST DOLLAR.]
Part A (6 tries; 5 points)
1. Using account analysis, what is the accountant's estimate oftotal fixed costs for October?
2. Using account analysis, what is the accountant's estimate ofvariable costs per unit for October?
Part B (6 tries; 5 points)
1. Using the high-low method, what is the accountant's estimate oftotal fixed costs for October?
2. Using the high-low method, what is the accountant's estimate oftotal variable costs for October?
Related questions
Lorenzo operates a brushless car wash. Incoming cars are put onan automatic, continuously moving conveyor belt. A car is washed asthe conveyor belt carries it from the start station to the finishstation. After the car moves off the conveyor belt, workers dry itand clean and vacuum the inside. Workers are managed by a singlesupervisor.
Lorenzo's accountant wants to estimate total costs in December,when 10,400 cars are expected to be washed. She uses two differentmethods to estimate total December costs, account analysis andhigh-low, with number of cars washed as the independent variablefor both methods.
For the account analysis method, she developed cost functionparameter estimates by analyzing actual costs in June, when 11,900cars were washed. The following are June total costs and her fixedcost estimates:
| Cost Item | Total Cost | Fixed Portion |
| Soap, cloths, and supplies | $7,140 | $0 |
| Water | $4,760 | $0 |
| Car wash labor | $34,810 | $2,680 |
| Power for conveyor | $12,220 | $2,700 |
| Supervisor and cashier | $3,300 | $3,300 |
For the high-low method, she developed cost function parameterestimates by using the actual costs in April and May, when 8,400and 11,500 cars were washed, respectively. The following are totalcosts for these two months:
| Cost Item | April | May |
| Soap, cloths, and supplies | $4,200 | $5,750 |
| Water | $5,040 | $6,900 |
| Car wash labor | $26,520 | $35,200 |
| Power for conveyor | $11,740 | $15,150 |
| Supervisor and cashier | $4,650 | $4,650 |
| Total | $52,150 | $67,650 |
REQUIRED [ROUND PER-UNIT COSTS TO THE NEAREST CENT ANDTOTAL COSTS TO THE NEAREST DOLLAR.]
Part A
1. Using account analysis, what is the accountant's estimate oftotal fixed costs for December?
2. Using account analysis, what is the accountant's estimate ofvariable costs per unit for December?
Part B [6 tries; 5 points]
1. Using the high-low method, what is the accountant's estimate oftotal fixed costs for December?
2. Using the high-low method, what is the accountant's estimate oftotal variable costs for December?
