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Blowing Rock Railroad decided to use the high-low method and operating data from the past six months to estimate the fixed and variable components of
Blowing Rock 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 Blowing Rock 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 | $709,700 | 210,000 | ||
February | 791,200 | 235,000 | ||
March | 559,200 | 152,000 | ||
April | 758,600 | 227,000 | ||
May | 636,200 | 183,000 | ||
June | 815,700 | 247,000 |
Determine the variable cost per gross-ton mile and the fixed cost.
Variable cost (Round to two decimal places.) | $ per gross-ton mile |
Total fixed cost | $ |
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