uring the past year, the high and low use of three different resources for Fly High Airlines occurred in July and April. The resources are airplane depreciation, fuel, and airplane maintenance. The number of airplane flight hours is the driver. The total costs of the three resources and the related number of airplane flight hours are as follows: Resource Airplane Flight Hours Total Cost Airplane depreciation: High 44,000 $ 18,000,000 Low 28,000 18,000,000 Fuel: High 44,000 445,896,000 Low 28,000 283,752,000 Airplane maintenance: High 44,000 15,792,000 Low 28,000 11,504,000 Required: Use the high-low method to answer the following questions. If an answer is zero, enter "0". 1. What is the variable rate for airplane depreciation? $fill in the blank 1per flight hour What is the fixed cost for airplane depreciation? $fill in the blank 2 2. What is the cost formula for airplane depreciation? Total cost of airplane depreciation = $fill in the blank 3 3. What is the variable rate for fuel? $fill in the blank 4 per flight hour What is the fixed cost for fuel? $fill in the blank 5
uring the past year, the high and low use of three different resources for Fly High Airlines occurred in July and April. The resources are airplane
Resource | Airplane Flight Hours | Total Cost |
Airplane depreciation: | ||
High | 44,000 | $ 18,000,000 |
Low | 28,000 | 18,000,000 |
Fuel: | ||
High | 44,000 | 445,896,000 |
Low | 28,000 | 283,752,000 |
Airplane maintenance: | ||
High | 44,000 | 15,792,000 |
Low | 28,000 | 11,504,000 |
Required:
Use the high-low method to answer the following questions. If an answer is zero, enter "0".
1. What is the variable rate for airplane depreciation?
$fill in the blank 1per flight hour
What is the fixed cost for airplane depreciation?
$fill in the blank 2
2. What is the cost formula for airplane depreciation?
Total cost of airplane depreciation = $fill in the blank 3
3. What is the variable rate for fuel?
$fill in the blank 4 per flight hour
What is the fixed cost for fuel?
$fill in the blank 5
4. What is the cost formula for fuel?
Total cost of fuel = $fill in the blank 6 x
5. What is the variable rate for airplane maintenance?
$fill in the blank 8 per flight hour
What is the fixed cost for airplane maintenance?
$fill in the blank 9
6. What is the cost formula for airplane maintenance?
Total cost of airplane maintenance = $fill in the blank 10 + ( $fill in the blank 11 × )
7. Using the three cost formulas that you developed, predict the cost of each resource in a month with 36,000 airplane flight hours.
Total cost of airplane depreciation | $fill in the blank 13 |
Total cost of fuel | $fill in the blank 14 |
Total cost of airplane maintenance | $fill in the blank 15 |
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