Assume that a company operates a fleet of limousines. If a limo is driven 80,000 miles during a year its average operating cost is 25 cents per mile. If a limo is driven only 60,000 miles during the year, its average operating cost is 30 cents per mile. Using the high-low method, what is the estimated fixed cost per year?
Total cost at 80,000 miles=(80,000*0.25)=$20,000
Total cost at 60,000 miles=(60,000*0.3)=$18000
Variable cost per mile=[Total cost at highest level-Total cost at lowest level]/(Highest level-Lowest level)
=(20,000-18000)/(80,000-60,000)
=$0.1 per mile
Total fixed cost=20,000-(80,000*0.1)
=$12000
Assume that a company operates a fleet of limousines. If a limo is driven 80,000 miles...
Assume that a company operates a fleet of limousines. If a limo is driven 80,000 miles during a year its average operating cost is 25 cents per mile. If a limo is driven only 60,000 miles during the year, its average operating cost is 30 cents per mile. Using the high-low method, what is the estimated variable operating cost per mile? Multiple Choice $0.12 O $0.15 $0.18 О O $0.10
Assume that a company operates a fleet of taxi cabs. If a taxi is driven 80,000 miles during a year its average operating cost is 25 cents per mile. If a taxi is driven only 60,000 miles during the year, its average operating cost is 30 cents per mile. Using the high-low method, what is the estimated fixed cost per year? Multiple Choice $12,000 $8,000 O $10,000 $15,000
1 Assume that a company operates a fleet of delivery trucks. If a truck is driven 80,000 miles during a year its average operating cost is 25 cents per mile If a truck is driven only 60,000 miles during the year, its average operating cost is 30 cents per mie. Using the high-low method, what would be the total estimated operating cost of a truck is driven 72,400 miles per year? Murple Choice O SC340 $1640 $40 O $19.840 50...
Exercise 2-12 Cost Behavior; High-Low Method [L02-3, LO2-4] Speedy Parcel Service operates a fleet of delivery trucks in a large metropolitan area. A careful study by the company's cost analyst has determined that if a truck is driven 120,000 miles during a year, the average operating cost is 11.6 cents per mile. If a truck is driven only 80,000 miles during a year, the average operating cost increases to 13.6 cents per mile. Required: 1.& 2.Using the high-low method, estimate...
Exercise 2-12 Cost Behavior; High-Low Method [LO2-3, LO2-4) Speedy Parcel Service operates a fleet of delivery trucks in a large metropolitan area. A careful study by the company's cost analyst has determined that if a truck is driven 120,000 miles during a year, the average operating cost is 11.6 cents per mile. If a truck is driven only 80,000 miles during a year, the average operating cost increases to 13.6 cents per mile. Required: 1.& 2. Using the high-low method,...
Hoi Chong Transport, Ltd., operates a fleet of delivery trucks in Singapore. The company has determined that if a truck is driven 105,000 kilometers during a year, the average operating cost is 11.4 cents per kilometer. If a truck is driven only 70,000 kilometers during a year, the average operating cost increases to 13.4 cents per kilometer. Required: 1. Using the high-low method, estimate the variable operating cost per kilometer and the annual fixed operating cost associated with the fleet...
Exercise 2-12 Cost Behavior, High-Low Method [LO2-3, Lo2-4) Speedy Parcel Service operates a feet of delivery trucks in a large metropoitan area. A careful study by the companys cost enalyst has determined that if a truck is driven 120,000 miles during a yeer, the average operating cost is 11.6 cents per mile. If a truck is driven only 80,000 miles during a year, the average operating cost increases to 136 cents per mile. Required: 1& 2.Using the high-low method, estimate...
Hoi Chong Transport, Ltd., operates a fleet of delivery trucks
in Singapore. The company has determined that if a truck is driven
141,000 kilometers during a year, the average operating cost is
12.1 cents per kilometer. If a truck is driven only 94,000
kilometers during a year, the average operating cost increases to
14.6 cents per kilometer.
Hoi Chong Transport, Ltd., operates a fleet of delivery trucks in Singapore. The company has determined that if a truck is driven 141,000...
Hoi Chong Transport, Ltd., operates a fleet of delivery trucks in Singapore. The company has determined that if a truck is driven 162,000 kilometers during a year, the average operating cost is 13.2 cents per kilometer. If a truck is driven only 108,000 kilometers during a year, the average operating cost increases to 16.6 cents per kilometer. Required: 1. Using the high-low method, estimate the variable operating cost per kilometer and the annual fixed operating cost associated with the fleet...
Hoi Chong Transport, Ltd., operates a fleet of delivery trucks in Singapore. The company has determined that if a truck is driven 105,000 kilometers during a year, the average operating cost is 11.6 cents per kilometer. If a truck is driven only 70,000 kilometers during a year, the average operating cost increases to 13.3 cents per kilometer. Required: 1. Using the high-low method, estimate the variable operating cost per kilometer and the annual fixed operating cost associated with the fleet...