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Caiman Distribution Partners is the Brazilian distribution company of a U.S. consumer products firm. Inflation in Brazil has made bidding and budgeting difficult for marketing managers trying to penetrate some of the country's rural regions. The company expects to distribute 450,000 cases of products in Brazil next month. The controller has classified operating costs (excluding costs of the distributed product) as follows.

Account	Operating Cost			Behavior
Supplies	$	1,784,000		All variable
Supervision		221,000		$	157,000	Fixed
Truck expense		1,110,000		$	171,000	Fixed
Building leases		861,000		$	557,000	Fixed
Utilities		230,000		$	140,000	Fixed
Warehouse labor		850,000		$	143,000	Fixed
Equipment leases		757,000		$	617,000	Fixed
Data processing equipment		928,000		All fixed
Other		831,000		$	359,000	Fixed
Total	$	7,572,000

Although overhead costs were related to revenues throughout the company, the experience in Brazil suggested to the managers that they should incorporate information from a published index of Brazilian prices in the distribution sector to forecast overhead in a manner more likely to capture the economics of the business.

Following instructions from the corporate offices, the controller's office in Brazil collected the following information for monthly operations from last year.

Month	Cases	Price Index	Operating Costs
1	241,000	105	$5,699,169
2	339,000	124	5,806,668
3	242,000	115	5,849,935
4	428,000	113	5,927,647
5	344,000	113	5,939,165
6	366,000	132	6,043,394
7	421,000	120	5,918,525
8	449,000	140	6,133,898
9	349,000	130	6,126,160
10	423,000	124	6,186,655
11	414,000	144	6,208,829
12	435,000	139	6,362,285

These data are considered representative for both past and future operations in Brazil.

a-1. Determine the variable cost per case assuming that 450,000 cases will be shipped next month based on the controller's analysis of accounts. (Round your answer to 2 decimal places.)

a-2. Prepare an estimate of operating costs.

c-1. Using Excel, calculate the simple regression of operating costs on cases shipped and enter the regression coefficients. (Intercept, Cases)

c-2. Compute the estimation of operating costs assuming that 450,000 cases will be shipped next month by using the results of a simple regression of operating costs on cases shipped.

d-1. Enter the regression coefficients. (Intercept, Cases, Price Index)

d-2. Compute the estimation of operating costs assuming that 450,000 cases will be shipped next month by using the results of a multiple regression of operating costs on cases shipped and the price level. Assume a price level of 145 for next month.

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