Question: 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

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 $1,055,700 351,000
February 1,177,100 392,000
March 831,900 254,000
April 1,128,600 380,000
May 946,500 306,000
June 1,213,500 413,000

Determine the variable cost per gross-ton mile and the 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

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