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The controller at Speedy Delivery wants to break-out the cost of deliveries into fixed and variable components so that it will be better able to
The controller at Speedy Delivery wants to break-out the cost of deliveries into fixed and variable components so that it will be better able to predict costs for next year. Below are the delivery costs incurred each month and the number of deliveries. Month Delivery Cost Deliveries January $2,176.00 105 February 2,272.00 110 March 1,926.40 92 April 1,696.00 80 May 1,600.00 75 June 2,752.00 135 July 3,616.00 180 August 1,849.60 88 September 1,676.80 79 October 3,808.00 190 November 3,961.60 198 December 4,000.00 200 Required: Using the high-low method: 1. Calculate the variable cost rate per deliveries. Round the answer to two decimal places. 2. Calculate the fixed cost of overhead. $ 3. Construct the cost formula for total overhead cost. If required, round your answer to two decimal places. Total cost Fixed cost + Variable cost + ($ per unit x Number of deliveries) 4. The company is estimating that in January the number of deliveries will 125. How much should it estimate to have in tota delivery costs for January
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