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 $851,600 378,000 February 949,400 423,000 March 671,000 274,000 April 910,300 409,000 May 763,500 329,000 June 978,800 445,000 Determine the variable cost per gross-ton mile and the total fixed cost. Variable cost (Round to two decimal places.) 2.17 X per gross-ton mile Total fixed cost 31,340 X Budget Performance Reports for Cost Centers Partially completed budget performance reports for Garland Company, a manufacturer of light duty motors, follow: Garland Company Budget Performance Report-Vice President, Production For the Month Ended November 30 Budget Actual Over Budget Under Budget Eastern Region $512,200 $512,200 Central Region 368,800 365,100 (3,700) Western Region (9) (h) $0) $(k) $(1) $(3,700) Plant $0 Garland Company Budget Performance Report-Manager, Western Region Plant For the Month Ended November 30 Department Budget Actual Over Budget Under Budget Chip Fabrication $(a) $(b) $(c) Electronic Assembly 80,010 81,050 1,040 Final Assembly 128,820 127,790 $(1,030) $(d) $(e) $(1) $(1,030) Garland Company Garland Company Budget Performance Report-Supervisor, Chip Fabrication For the Month Ended November 30 Cost Budget Actual Over Budget Under Budget Factory wages $31,980 $34,220 $2,240 Materials 68,750 $(480) Power and light 3,670 4,370 700 Maintenance 7,560 8,280 $111,960 $115,140 $3,660 $(480) a. Complete the budget performance reports by determining the correct amounts for the lettered spaces (a-1) as marked above. 68,270 720 a. $ 9. $ b. $ h. $ C. $ I. $ d. $ j. $ e. $ k. f. $ 1. b. Complete the following memo to Cassandra Reid, vice president of production for Garland Company, explaining the performance of the production division for November MEMO b. Complete the following memo to Cassandra Reid, vice president of production for Garland Company, explaining the performance of the production division for November MEMO To: Cassandra Reid, Vice President of Production plant has experienced a budget overrun. Its budget reveals that the Department caused the majority of the budget overrun. The supervisor of the Department should investigate the reasons for the budget overruns in The
