Scatter Graph

Presented by:
Method
Jeraldine Calimpong
Rey Mari Levi Perez
Quen Resurreccion
Scatter Graph Method
-a visual technique used in accounting for separating the fixed and variable elements of a semi-
variable expense (also called a mixed cost) in order to estimate and budget for future costs.

-it is used to determine relationship between two variable.

-the x-variable is the independent variable.

-the y-variable is the dependent variable.

KLM manufacturing company has the following data for its electric consumption in the production area for
the half of the year 2021.
Step 1: Draw a Scatter Graph

Electricity Costs
Cont.
Step 2: Use the y-intercept equation to estimate costs

y= mx+b

y= total amount costs of the month

m= electricity cost per unit of production (slope, as the variable cost per unit)
x= total level of the production per month
b= fixed cost
 y=mx+b

4,700= (0.8) (750) + 4,100

4,700= 600+ 4,100
4,700= 4,700

4,890= (0.8) (1000) + 4,100

4,890= 800 + 4,100
4,890= 4,900

Limitation:
-it only depends on the visual solution we can see on the graph, we cannot perfectly draw a line
in the graph.
Thank you!!!