High-low method for a service company Sierra Railroad Inc. decided to use the high-low method and operating data from the past six months to estimate the fixed and variable components of transportation costs. The activity base used by Sierra Railroad is "gross-ton miles," which is the total number of tons multiplied by the miles moved. Transportation Costs January February March April May June $1,022,500 1,140,000 805,700 1,093,000 916,700 1,175,300 Gross-Ton Miles 292,000 326,000 211,000 316,000 254,000 343,000 Determine the variable cost per gross-ton mile and the total fixed cost. Variable cost (If required, round to two decimal places.) $ Total fixed cost $ per gross-ton mile
High-low method for a service company Sierra Railroad Inc. decided to use the high-low method and operating data from the past six months to estimate the fixed and variable components of transportation costs. The activity base used by Sierra Railroad is "gross-ton miles," which is the total number of tons multiplied by the miles moved. Transportation Costs January February March April May June $1,022,500 1,140,000 805,700 1,093,000 916,700 1,175,300 Gross-Ton Miles 292,000 326,000 211,000 316,000 254,000 343,000 Determine the variable cost per gross-ton mile and the total fixed cost. Variable cost (If required, round to two decimal places.) $ Total fixed cost $ per gross-ton mile
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Dd.43.

Transcribed Image Text:High-low method for a service company
Sierra Railroad Inc. decided to use the high-low method and operating data from the past six months to estimate the fixed and variable components of transportation
costs. The activity base used by Sierra Railroad is "gross-ton miles," which is the total number of tons multiplied by the miles moved.
Transportation Costs
January
February
March
April
May
June
$1,022,500
1,140,000
805,700
1,093,000
916,700
1,175,300
Gross-Ton Miles
292,000
326,000
211,000
316,000
254,000
343,000
Determine the variable cost per gross-ton mile and the total fixed cost.
Variable cost (If required, round to two decimal places.) $
Total fixed cost $
per gross-ton mile
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