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High-Low Method for Service Company Miss River Railroad decided to use the high-low method and operating data from the past six months to estimate the
High-Low Method for Service Company Miss River 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 Miss River 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 $949,500 230,000 February 1,058,700 257,000 March 748,200 166,000 April 1,015,000 248,000 May 851,300 200,000 June 1,091,400 270,000 Determine the variable cost per gross-ton mile and the fixed costs. Round variable cost per unit to the nearest cent. Variable cost per gross-ton mile Fixed cost
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