.
The maintenance cost incurred and the actual machine hours worked during the months of January, February, March, and April 2003 were as follows:
| Month | Machine hours in Production departments | Maintenance departments Costs |
|
|
| Sh. |
| January | 800 | 350 |
| February | 1,200 | 350 |
| March | 400 | 150 |
| April | 1,600 | 550 |
Required:
- Determine the cost estimation function using:
- High-low method.(2 marks)
- Regression analysis(2marks)
- Using the regression function estimate:
- The maintenance costs that would have been incurred if the machine hours were expected to be 900 in the month of May 2003.(1 mark)