1) Evander Inc. has decided to use the high-low method to estimate the total cost and the fixed and variable cost components of the total cost. The data for various levels of production are as follows:

Units Produced	Total Costs
2,015	$217,620
3,140	250,260
5,115	338,520

a. Determine the variable cost per unit and the total fixed cost. Variable cost _____________ ?? Total fixed _______________ ??

b. Based on part (a), estimate the total cost for 2,570 units of production. Total cost for 2,570 __________ ?? 2) High-low method for a service company

Sierra Railroad Inc. 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 Sierra Railroad is gross-ton miles, which is the total number of tons multiplied by the miles moved.

Month	Transportation Costs	Gross-Ton Miles
January	$1,203,500	384,000
February	1,341,800	429,000
March	948,300	278,000
April	1,286,500	416,000
May	1,079,000	334,000
June	1,383,300	452,000

Determine the variable cost per gross-ton mile and the total fixed cost. Variable cost (If required, round to two decimal places.) ________ per gross-ton mile ??? Total fixed cost__________ ???

3)Contribution margin and contribution margin ratio

For a recent year, McDonalds (MCD) company-owned restaurants had the following sales and expenses (in millions):

Line Item Description	Amount
Sales	$20,000
Food and paper	$(2,600)
Payroll and employee benefits	(2,200)
Occupancy and other expenses	(4,100)
General, selling, and administrative expenses	(5,100)
Total	$(14,000)
Operating income	$6,000

Assume that the variable costs consist of food and paper, payroll, 25% of occupancy and other expenses, and 40% of the general, selling, and administrative expenses.

a. What is McDonald's contribution margin?

b. What is McDonald's contribution margin ratio? Round to one decimal place.

c. How much would operating income increase if same-store sales increased by $800 million for the coming year, with no change in the contribution margin ratio or fixed costs? Round your answer to the nearest tenth of a million (one decimal place).