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Total Cost 12,000 12,000 39,600 16,500 14,000 10,500 1 Scenic Byways is a bus tour company. 2 The peak month for touring is July and
Total Cost 12,000 12,000 39,600 16,500 14,000 10,500 1 Scenic Byways is a bus tour company. 2 The peak month for touring is July and the lowest month is February., 3 Here are three costs associated with the buses for those two months: 4 5 Resource Bus Miles 6 7 Bus Depreciation 8 July 120,000 9 February 50,000 10 11 Fuel 12 July 120,000 13 February 50,000 14 15 Repairs and Maintenance 16 July 120,000 17 February 50,000 18 19 20 Use the high-low method to answer the following questions: (round to nearest $0.00) 21 22 a What is the variable rate of depreciation? 23 b What is the fixed cost of depreciation? 24 c What is the cost formula for depreciation? 25 d What is the variable rate of fuel? 26 e What is the fixed cost of fuel? 27 f What is the cost formula for fuel? 28 g What is the variable rate of repairs and maintenance? 29 h What is the fixed cost of repairs and maintenance? 30 i What is the cost formula for repairs and maintenance? 31 j Using the three cost formulas, compute a month that has 32 each of the miles driven 33 78,000 34 105,000 35 92,000
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