We Deliver operates a fiect of delivery trucks in Halifax. Analysis shows that if a...
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We Deliver operates a fiect of delivery trucks in Halifax. Analysis shows that if a truck is driven 152,000 kilometres during a year, the average operating cost is 12.2 cents ($0.122 ) per kilometre. If a truck is driven only 94,000 kilometres during a year, the average operating cost increases to 14.2 cents ($0.142) per kilometre. Required: 1. Using the high-low method, estimate the variable and fixed cost elements of the annual cost of truck operation. (Do not round your intermediate calculations. Round the "Varlable cost per kilometer" to 3 decimal places.) 2. Express the variable and floed costs in the form Y=a+bX. (Do not round your intermediate calculations. Round the "Variable cost per kllometer" to 3 decimal places.) 3. If a truck were driven 151,300 kilometres during a year, what total cost would you expect to be incurred? (Do not round Intermediate calculations. Round the "Varlable cost per kilometer" to 3 decimal places.)
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