Learning Objective 1 3.54,000 E21-32 Determining mixed costs-the high-low method The manager of Trusty Car Inspection reviewed the monthly operating costs for the past year. The costs ranged from $4,300 for 1,300 inspections to $3,900 for 90 inspections. Requirements 1. Use the high-low method to calculate the variable cost per inspection. 2. Calculate the total fixed costs. 3. Write the equation and calculate the operating costs for 1,000 inspections 4. Draw a graph illustrating the total cost under this plan. Label the axes, and show the costs at 900, 1,000, and 1,300 inspections. Learning Objective 2 E21-33 Calculating contribution margin ratio, preparing contribution margin income statements For its top managers, Worldwide Travel formats its income statement as follows: 2.5253,000 sales level, VC $108,790 WORLDWIDE TRAVEL Contribution Margin Income Statement Three Months Ended March 31, 2018 Net Sales Revenue Variable Costs Contribution Margin Fixed Costs Operating Income $ 316,500 136,095 180,405 173,000 $ 7,405 Worldwide's relevant range is between sales of $253,000 and $368,000. Requirements 1. Calculate the contribution margin ratio 2. Prepare two contribution margin income statements: one at the $253,000 sales level and one at the $368,000 sales level. (Hist. The proportion of each sales that goes toward variable costs is constant within the relevant range.)