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Rio Bus Tours has incurred the following bus maintenance costs during the recent tourist season. (The real is Brazils national monetary unit. On the day

Rio Bus Tours has incurred the following bus maintenance costs during the recent tourist season. (The real is Brazils national monetary unit. On the day this exercise was written, the real was equivalent in value to 0.2545 U.S. dollar.)

Month Miles Traveled by Tour Buses Cost
November 15,750 19,100 real
December 17,900 19,400
January 20,050 19,550
February 24,500 20,000
March 32,000 21,470
April 14,000 18,500

Required: 1. Use the high-low method to estimate the variable cost per tour mile traveled and the fixed cost per month. 2. Develop a formula to express the cost behavior exhibited by the companys maintenance cost. 3. Predict the level of maintenance cost that would be incurred during a month when 49,000 tour miles are driven.

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