High-Low Method for a Service Company Boston Railroad 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 Boston Railroad is a measure of railroad operating activity, termed “gross-ton miles,” which is the total number of tons multiplied by the miles moved. Transportation Costs Gross-Ton Miles January $987,700 225,000 February 1,101,200 252,000 March 778,300 163,000 April 1,055,800 244,000 May 885,500 196,000 June 1,135,300 265,000 Determine the variable cost per gross-ton mile and the fixed cost. Variable cost (Round to two decimal places.) $fill in the blank 1 per gross-ton mile Total fixed cost
High-Low Method for a Service Company Boston Railroad 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 Boston Railroad is a measure of railroad operating activity, termed “gross-ton miles,” which is the total number of tons multiplied by the miles moved. Transportation Costs Gross-Ton Miles January $987,700 225,000 February 1,101,200 252,000 March 778,300 163,000 April 1,055,800 244,000 May 885,500 196,000 June 1,135,300 265,000 Determine the variable cost per gross-ton mile and the fixed cost. Variable cost (Round to two decimal places.) $fill in the blank 1 per gross-ton mile Total fixed cost
Chapter1: Financial Statements And Business Decisions
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Question 11
High-Low Method for a Service Company
Boston Railroad 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 Boston Railroad is a measure of railroad operating activity, termed “gross-ton miles,” which is the total number of tons multiplied by the miles moved.
| Transportation Costs | Gross-Ton Miles | |||
| January | $987,700 | 225,000 | ||
| February | 1,101,200 | 252,000 | ||
| March | 778,300 | 163,000 | ||
| April | 1,055,800 | 244,000 | ||
| May | 885,500 | 196,000 | ||
| June | 1,135,300 | 265,000 |
Determine the variable cost per gross-ton mile and the fixed cost.
| Variable cost (Round to two decimal places.) | $fill in the blank 1 per gross-ton mile |
| Total fixed cost |
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