Reference no: EM132573739

Albedo Inc. manufactures high-end replacement telescope lenses for amateur and professional astronomers who are seeking to upgrade the performance of their telescopes. You have just become employed as a staff accountant at Albedo, and Jordan Coleman, the controller, has asked you to help with maintenance cost estimation for the lens manufacturing process. You review the manufacturing process and decide that the best cost driver for maintenance costs is machine hours.

The data below are from the previous fiscal year for maintenance costs and machine hours:

Month                Maintenance Cost              Machine Hours

1                         $3,210                              2,750

2                           4,650                              3,900

3                             5,175                           4,050

4                          3,350                               2,690

5                         3,100                               2,500

6                          2,950                            2,580

7                           2,900                         2,300

8                           2,900                       2,500

9                             4,120                      3,160

10                           4,350                       3,325

11                         3,500                       2,780

12                        3,775                       3,000

Required:

Question 1. What is the cost equation for maintenance costs using the high-low method? (Round "slope (unit variable cost)" to 2 decimal places. Negative amounts should be indicated by a minus sign.)

Question 2. Graph the data and comment on whether or not there are potential outliers. (To earn full credit for this graph you must plot all required points for each curve. While plotting the points a tool icon will pop up. You can use this to enter exact co-ordinates for your points as needed.)