Chapter 03 Inclass quiz_SOLN

# Chapter 03 Inclass quiz_SOLN - Answer \$2.00 per mile \$4,700...

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Acc 200P Name: ________________________ Lab Section #_________________ Chapter 3 SOLUTION Trusty Delivery Inc. would like to estimate the cost of operating its delivery trucks and has decided to use the high/low method. The high and low activity level months have been identified and the following information is available # miles driven Operating Costs June ------------------ 800 \$3,500 September ----------- 1,400 4,700 A. Using the data above, what is the variable cost per mile?
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Unformatted text preview: Answer: _ \$2.00 per mile _ \$4,700 - \$3,500 = \$2.00 per mile 1,400 - 800 B. Using the data above, what is the total fixed cost per month? Answer: _ \$1,900 ___ \$4,700 = FC + \$2(1,400) FC = \$1,900 C. Write the equation to predict total mixed costs. Y = \$1,900 + \$2x D. If management expects 1,000 miles to be driven in October, calculate total estimated operating costs. Answer: _____________ Y = \$1,900 + \$2(1,000) Y = \$3,900...
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