Bundle: Managerial Accounting, Loose-leaf Version, 14th - Book Only
14th Edition
ISBN: 9781337541398
Author: Carl Warren; James M. Reeve; Jonathan Duchac
Publisher: Cengage Learning
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Chapter 5, Problem 8E
To determine
High-low method: It is the method of estimating the variable cost per unit and the fixed costs by using the highest and the lowest level of activities and their associated costs.
the variable cost per gross-ton mile.
To determine
the total fixed cost.
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High-Low Method for a Service Company
Boston Railroad decided to use the high-low method and operating data from the past six months to estimate the fixed and variable components of transportation costs. The activity base used by Boston Railroad is a measure of railroad operating activity, termed "gross-ton miles," which is the total number of tons multiplied by the miles moved.
Transportation Costs
Gross-Ton Miles
January
$999,000
347,000
February
1,113,900
388,000
March
787,200
251,000
April
1,067,900
375,000
May
895,700
302,000
June
1,148,300
408,000
Determine the variable cost per gross-ton mile and the total fixed cost.
Variable cost (Round to two decimal places.)
$fill in the blank 1 per gross-ton mile
Total fixed cost
$fill in the blank 2
High-Low Method for a Service Company
Boston Railroad decided to use the high-low method and operating data from the past six months to estimate the fixed and variable components of transportation costs
The activity base used by Boston Railroad is a measure of railroad operating activity, termed "gross-ton miles," which is the total number of tons multiplied by the miles
moved.
Transportation Costs
Gross-Ton Miles
January
$1,324,700
294,000
February
1,476,900
329,000
March
1,043,800
213,000
April
1,416,000
318,000
May
1,187,600
256,000
June
1,522,600
346,000
Determine the variable cost per gross-ton mile and the fixed cost.
Variable cost (Round to two decimal places.)
%$4
per gross-ton mile
Total fixed cost
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High-Low Method for a Service Company
Continental Railroad decided to use the high-low method and operating data from the past six months to estimate the fixed and variable components of transportation costs. The activity base used by Continental Railroad is a measure of railroad operating activity, termed "gross-ton miles," which is the total number of tons multiplied by the miles moved.
Transportation Costs
Gross-Ton Miles
January
$1,132,100
292,000
February
1,262,300
326,000
March
892,100
211,000
April
1,210,200
316,000
May
1,015,000
254,000
June
1,301,300
343,000
Determine the variable cost per gross-ton mile and the total fixed cost.
Variable cost (Round to two decimal places.)
$ per gross-ton mile
Total fixed cost
$
Chapter 5 Solutions
Bundle: Managerial Accounting, Loose-leaf Version, 14th - Book Only
Ch. 5 - Describe how total variable costs and unit...Ch. 5 - Which of the following costs would be classified...Ch. 5 - Describe how total fixed costs and unit fixed...Ch. 5 - Prob. 4DQCh. 5 - Prob. 5DQCh. 5 - Prob. 6DQCh. 5 - Prob. 7DQCh. 5 - Prob. 8DQCh. 5 - Prob. 9DQCh. 5 - What does operating leverage measure, and how is...
Ch. 5 - Prob. 1BECh. 5 - Prob. 2BECh. 5 - Prob. 3BECh. 5 - Prob. 4BECh. 5 - Prob. 5BECh. 5 - Prob. 6BECh. 5 - Prob. 7BECh. 5 - Classify Costs Following is a list of various...Ch. 5 - Identify cost graphs The following cost graphs...Ch. 5 - Identify activity bases For a major university,...Ch. 5 - Prob. 4ECh. 5 - Identify fixed and variable costs Intuit Inc....Ch. 5 - Prob. 6ECh. 5 - High-low method Ziegler Inc. has decided to use...Ch. 5 - Prob. 8ECh. 5 - Contribution margin ratio Young Company budgets...Ch. 5 - Prob. 10ECh. 5 - Prob. 11ECh. 5 - Prob. 12ECh. 5 - Prob. 13ECh. 5 - Prob. 14ECh. 5 - Prob. 15ECh. 5 - Prob. 16ECh. 5 - Prob. 17ECh. 5 - Prob. 18ECh. 5 - Prob. 19ECh. 5 - Prob. 20ECh. 5 - Prob. 21ECh. 5 - Prob. 22ECh. 5 - Prob. 23ECh. 5 - Prob. 24ECh. 5 - Prob. 25ECh. 5 - Classify costs Seymour Clothing Co. manufactures a...Ch. 5 - Prob. 2PACh. 5 - Prob. 3PACh. 5 - Prob. 4PACh. 5 - Prob. 5PACh. 5 - Contribution margin, break-even sales,...Ch. 5 - Classify costs Cromwell Furniture Company...Ch. 5 - Prob. 2PBCh. 5 - Prob. 3PBCh. 5 - Prob. 4PBCh. 5 - Prob. 5PBCh. 5 - Contribution margin, break-even sales,...Ch. 5 - Prob. 1ADMCh. 5 - Prob. 2ADMCh. 5 - Prob. 3ADMCh. 5 - Prob. 1TIFCh. 5 - Prob. 3TIF
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