Answered step by step
Verified Expert Solution
Question
1 Approved Answer
just 1-3 please Russell Preston delivers parts for several local auto parts stores. He charges clients $1.45 per mile driven. Russell has determined that if
just 1-3 please
Russell Preston delivers parts for several local auto parts stores. He charges clients $1.45 per mile driven. Russell has determined that if he drives 2,700 miles in a month, his average operating cost is $0.90 per mile. If he drives 3,700 miles in a month, his average operating cost is $0.80 per mile. Russell has used the high-low method to determine that his monthly cost equation is total cost = $1,380 + $0.53 per mile. 0-00 sk ences Required: 1. Determine how many miles Russell needs to drive to break even. 2. Assume Russell drove 2,000 miles last month. Without making any additional calculations, determine whether he earned a profit or a loss last month. 3. Determine how many miles Russell must drive to earn $1,840 in profit. 4-a. Prepare a contribution margin income statement assuming Russell drove 2,000 miles last month. 4-b. Use the information provided in Req 4a to calculate Russell's degree of operating leverage. Complete this question by entering your answers in the tabs belowStep by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started