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High-Low Method for a Service Company 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 rairoad op asure 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 $670,600 224,000 February 747,700 250,000 March 528,400 162,000 April 716,800 242,000 May 601,200 195,000 June 770,800 263,000 Determine the variable cost per gross-ton mile and the fixed cost. Variable cost (Round to two decimal places.) per gross-ton mile Total fixed cost Contribution Margin and Contribution Margin Ratio For a recent year, Wicker Company-owned restaurants had the following sales and expenses (in millions): Sales $23,000 Food and packaging $8,750 Payroll 5,800 Occupancy (rent, depreciation, etc.) 4,460 3,300 General, selling, and administrative expenses $22,310 $690 Income from operations Assume that the variable costs consist of food and packaging, payroll, and 40% of the general, selling, and administrative expenses. a. What is Wicker Company's contribution margin? Round to the nearest million. (Give answer in millions of dollars.) 14,250 X million b. What is Wicker Company's contribution margin ratio? Round to one decimal place. 62.01 x % c. How much would income from operations increase if same-store sales increased by $1,400 million for the coming year, with no change in the contribution margin ratio or fixed costs? Round your answer to the closest million. 2,568 X million Check My Work a. Sales minus total variable costs equals contribution margin. b. Contribution margin divided by sales equals contribution margin ratio. c. Multiply the sales increase by the contribution margin percentage

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