Hoi Chong Transport, Ltd., operates a fleet of delivery trucks in Singapore. The company has determined that if a truck travels 135,000 kilometers in a year, the average operating cost is 14.5 cents per kilometer. If a truck travels only 90,000 kilometers in a year, the average operating cost rises to 18.1 cents per kilometer. 

Required:
1.	Using the high-low method, estimate the variable and fixed cost elements of the annual cost of operating the truck.

2.	Express the fixed and variable costs in the form Y = a + bX.

3.	If a truck traveled 112,000 kilometers in a year, what total cost would you expect to incur?

Answer rating: 100% (QA)

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