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Question Help Kristen Tran, owner of Flower Hour, operates a local chain of floral shops. Each shop has its own delivery van. Instead of charging
Question Help Kristen Tran, owner of Flower Hour, operates a local chain of floral shops. Each shop has its own delivery van. Instead of charging a flat delivery fee, Tran wants to set the delivery foe based on the distance driven to deliver the flowers. Tran wants to separate the fixed and variable portions of her van operating costs so that she has a better idea how delivery distance affects these costs She has the following data from the past seven months (Click the icon to view the data) Use the high-low method to determine Flower Hour's cost equation for van operating costs Use your results to predict van operating costs at a volume of 16,000 miles Let's begin by determining the formula that is used to calculate the variable cost (slope) Change in cost Change in volume Variable cost (slope) Data Table Now determine the formula that is used to calculate the fixed cost component Total operating cost Total variable cost = Fixed cost Month January Use the high-low method to determine Flower Hour's operating cost equation (Round the variable cost to the neare y= s x +s ] February March Miles Driven 15,500 17 400 15.400 16,300 16,500 15,200 14.400 Van Operating Costs $5,390 $5,280 $4,960 55,340 $5,450 $5,230 $4,680 April May June July
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