Brazilia Bus Company has incurred the following bus maintenance costs during the last quarter:

Month Miles Maintenance Costs

April 12,000 16,500 real

May 30,000 18,750

June 22,500 18,000

________________________________________________ Note: The Real is the unit of Brazilian currency.

Estimate the variable maintenance cost per mile traveled and the fixed monthly maintenance cost for the firm, using the hi-lo method.

Answer: _____ variable cost per mile

__ fixed cost per month

Total Fixed Cost = total cost - total variable costs If the estimate of the miles to be driven in July is 16,000 miles, what will you estimate total maintenance costs to be in that month?

Answer: ___ real