Hoi Chong Transport, Limited, operates a fleet of delivery trucks in Singapore. The company has determined that if a truck is driven 159,000 kilometers during a year, the average operating cost is 12.7 cents per kilometer. If a truck is driven only 106,000 kilometers during a year, the average operating cost increases to 15.8 cents per kilometer. Required: 1. Using the high-low method, estimate the variable operating cost per kilometer and the annual fixed operating cost associated with the fleet of trucks. 2. Express the variable and fixed costs in the form Y = a + bX. 3. If a truck were driven 132,000 kilometers during a year, what total operating cost would you expect to be incurred? Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 Using the high-low method, estimate the variable operating cost per kilometer and the annual fixed operating cost associated with the fleet of trucks. (Do not round your intermediate calculations. Round the Variable cost per kilometer to 3 decimal places.) Variable cost Fixed cost per kilomete per year Required 1 Search Required 2 > Prev 1 of 1 Next >

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
icon
Related questions
Question
e 5A-3-Con x +
mheducation.com/ext/map/index.html?_con=con&external_browser=0&launchUrl=https% 253A%252F%252Fmycstate.cincinnatistate.edu%252Fweba
Hoi Chong Transport, Limited, operates a fleet of delivery trucks in Singapore. The company has determined that if a truck is driven
159,000 kilometers during a year, the average operating cost is 12.7 cents per kilometer. If a truck is driven only 106,000 kilometers
during a year, the average operating cost increases to 15.8 cents per kilometer.
Required:
1. Using the high-low method, estimate the variable operating cost per kilometer and the annual fixed operating cost associated with
the fleet of trucks.
2. Express the variable and fixed costs in the form Y = a +bX.
3. If a truck were driven 132,000 kilometers during a year, what total operating cost would you expect to be incurred?
Complete this question by entering your answers in the tabs below.
Required 1 Required 2
Required 3
Variable cost
Fixed cost
Using the high-low method, estimate the variable operating cost per kilometer and the annual fixed operating cost associated
with the fleet of trucks. (Do not round your intermediate calculations. Round the Variable cost per kilometer to 3 decimal
places.)
per kilometer
per year
Required 1
Saved
Q Search
Required 2 >
Prev
1 of 1
Next >
a
99+
Transcribed Image Text:e 5A-3-Con x + mheducation.com/ext/map/index.html?_con=con&external_browser=0&launchUrl=https% 253A%252F%252Fmycstate.cincinnatistate.edu%252Fweba Hoi Chong Transport, Limited, operates a fleet of delivery trucks in Singapore. The company has determined that if a truck is driven 159,000 kilometers during a year, the average operating cost is 12.7 cents per kilometer. If a truck is driven only 106,000 kilometers during a year, the average operating cost increases to 15.8 cents per kilometer. Required: 1. Using the high-low method, estimate the variable operating cost per kilometer and the annual fixed operating cost associated with the fleet of trucks. 2. Express the variable and fixed costs in the form Y = a +bX. 3. If a truck were driven 132,000 kilometers during a year, what total operating cost would you expect to be incurred? Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 Variable cost Fixed cost Using the high-low method, estimate the variable operating cost per kilometer and the annual fixed operating cost associated with the fleet of trucks. (Do not round your intermediate calculations. Round the Variable cost per kilometer to 3 decimal places.) per kilometer per year Required 1 Saved Q Search Required 2 > Prev 1 of 1 Next > a 99+
Expert Solution
trending now

Trending now

This is a popular solution!

steps

Step by step

Solved in 5 steps

Blurred answer
Similar questions
  • SEE MORE QUESTIONS
Recommended textbooks for you
FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
Accounting
ISBN:
9781259964947
Author:
Libby
Publisher:
MCG
Accounting
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Horngren's Cost Accounting: A Managerial Emphasis…
Horngren's Cost Accounting: A Managerial Emphasis…
Accounting
ISBN:
9780134475585
Author:
Srikant M. Datar, Madhav V. Rajan
Publisher:
PEARSON
Intermediate Accounting
Intermediate Accounting
Accounting
ISBN:
9781259722660
Author:
J. David Spiceland, Mark W. Nelson, Wayne M Thomas
Publisher:
McGraw-Hill Education
Financial and Managerial Accounting
Financial and Managerial Accounting
Accounting
ISBN:
9781259726705
Author:
John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles
Publisher:
McGraw-Hill Education