## (Solution Download) Hoi Chong Transport, Ltd., operates a fleet of delivery trucks in Singapore. The company has determi

Hoi Chong Transport, Ltd., operates a fleet of delivery trucks

in Singapore. The company has determined that if a truck is driven

135,000 kilometers during a year, the average operating cost is

14.5 cents per kilometer. If a truck is driven only 90,000

kilometers during a year, the average operating cost increases to

18.1 cents per kilometer.

 Using the high-low method, estimate the variable and fixed cost elements of the annual cost of the truck operation. (Do not round your intermediate calculations. Round the Variable cost per kilometer to 3 decimal places and Fixed cost answer to nearest whole dollar amount.) High Level of Activity ___ Low Level of Activity ___ Change ___ Varaible cost pe kilometer ___ Fixed cost per year___

 2 Express the variable and fixed costs in the form Y = a + bX. (Do not round your intermediate calculations. Round the Variable cost per kilometer to 3 decimal places.)

 3 If a truck were driven 112,000 kilometers during a year, what total cost would you expect to be incurred? (Do not round intermediate calculations.)

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