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	$725,400		305,000
February	808,800		341,000
March	571,600		221,000
April	775,400		330,000
May	650,400		266,000
June	833,800		359,000

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	$