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High-low method for a service company Sierra Railroad Inc. decided to use the high-low method and operating data from the past six months to
High-low method for a service company Sierra Railroad Inc. 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 Sierra Railroad is "gross ton miles," which is the total number of tons multiplied by the miles moved. Transportation Costs Gross Ton Miles January $803,400 268,000 February 895,800 299,000 March 633,100 194,000 April 858,900 290,000 May 720,300 233,000 June 923,500 315,000 Determine the variable cost per gross ton mile and the total fixed cost. Variable cost (If required, round to two decimal places.) Total fixed cost $ per gross-ton mile
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