Methods of Estimating Costs-High-Low Cost: During the past five years, operations at a company have remained relatively stable. Over this time, the following data are available from the accounting records:

Required:

a. Use the high-low method to estimate the fixed and variable portion of the company's marketing costs.

b. Estimate the marketing costs for sales of $3,750,000.

c. Using the cost estimates computed in requirement (a). how much would you expect marketing costs to increase for every one dollar increase in sales?

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Item Marketing costs Dollar sales Highest Amount $ 213,600 4,103,200 Lowest Amount $ 129,300 2,130,400