Bethany Link delivers parts for several local auto parts stores She charges clie

Question

Bethany Link delivers parts for several local auto parts stores She charges clients $2 93 per mile driven She has determined that f she drives 2,600 miles in a month, her average operating cost s $2 73 per mle. If Bethany drives 5.200 miles in a month, her average operating cost is $2 10 per mle Required: 1. Using the high-low method, determine Bethany's vanable and fhxed operating cost components. (Round your cost per unit answer to 2 decimal places.) ariable Cost per Mile Driven Fixed Cost si (Round your 2. plete the con un margin nco mesta er entfor the busness last month when Bera y dove 2860 ntermediate calculations to 2 decimal places and final answers to the nearest whole number) des (Assure his tals went e reevant an e oe era Contribution Margin Income Statement For the Last Month Contribution Margin Net Operating Income

Explanation / Answer

Service Charge 2.93 Av Cost Per Mile Total Cost Low Level 2600 2.73 7098 High Level 5200 2.10 10920 Variable Cost Per Mile: Change in Cost/Change in Activity Level (10920-7098)/(5200-2600) 1.47 Per Mile At 2600 Level: Total Cost 7098 Variable Cost 3822 (1.47*2600) Fixed Cost 3276 1 Variable Cost Per Mile 1.47 Fixed Cost 3276 2 BETHANY LINK Contribution Margin Income Statement For the Last Month Service Revenue 8380 (2.93*2860) Less: Variable Cost 4204 (1.47*2860) Contribution Margin 4176 Less: Fixed Costs 3276 Net Operating Income 900

Related Questions

Navigate

• Browse (All)
• Browse B
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.