The Heartland Delivery Service has the following information about its truck fleet miles and operating costs:
What is the best estimate of fixed costs for fleet operating expenses in 2017 using the high-low method?
A) $50,000
B) $17,000
C) $17,500
D) $25,000

Question

The Heartland Delivery Service has the following information about its truck fleet miles and operating costs:
 What is the best estimate of fixed costs for fleet operating expenses in 2017 using the high-low method?
A) $50,000 
B) $17,000 
C) $17,500 
D) $25,000

Quizplus · Accepted Answer

($105,000 - $80,000) / (175,000 - 125,000) = $0.50 per mile variable cost
$105,000 - (175,000 × $0.50) = $17,500

The Heartland Delivery Service Has the Following Information About Its