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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
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 | $708,300 | 283,000 | ||
February | 789,700 | 316,000 | ||
March | 558,100 | 205,000 | ||
April | 757,100 | 306,000 | ||
May | 635,000 | 246,000 | ||
June | 814,100 | 333,000 |
Determine the variable cost per gross-ton mile and the total fixed cost.
Variable cost (Round to two decimal places.) | $ per gross-ton mile |
Total fixed cost | $ |
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