Milden Company has an exclusive franchise to purchase a product from the manufacturer and distribute it on the retail level. As an aid in planning, the company has decided to start using a contribution format income statement. To have data to prepare such a statement, the company has analyzed its expenses and has developed the following cost formulas Cost Cost of good sold Advertising expense Sales commissions Shipping expense Administrative salaries Insurance expense Depreciation expense Cost Formula 28 per unit sold $185,000 per quarter 6% of sales $95,000 per quarter $10,500 per quarter $65,000 per quarter Management has concluded that shipping expense is a mixed cost, containing both variable and fixed cost elements. Units sold and the related shipping expense over the last eight quarters follow Shipping Units Sold Expense Quarter Year 1: First Second Third Fourth 31,000 $175,000 33,000 $190,000 38,000 $232,000 34,000 $195,000 Year 2 First Second Third Fourth 32,000 $185,000 35,000 $200,000 49,000 $247,000 46,000 $223,000 Milden Company's president would like a cost formula derived for shipping expense so that a budgeted contribution format income statement can be prepared for the next quarter Required 1. Using the high-low method, estimate a cost formula for shipping expense based on the data for the last eight quarters above