The following data was collected by Big Company Railway

Miles Total Cost

July 300,000 $290,000

August 250,000 $287,500

September 630,000 $306,500

October 950,000 $322,500

November 1,275,000 $338,750

December 1,000,000 $325,000

REQUIRED:

(a) Using the High Low Method, determine the variable cost per hour, total fixed cost and put into the Cost Equation

(b) Estimate the cost for a month in which use for 460,000 miles.