Exercise 6A-1 (Static) High-Low Method [LO6-10] The Cheyenne Hotel in Big Sky, Montana, has accumulated records of the total electrical costs of the hotel and the number of occupancy-days over the last year. An occupancy-day represents a room rented for one day. The hotel's business is highly seasonal, with peaks occurring during the ski season and in the summer. Occupancy- Electrical Days January 1,736 $4,127 February 1,904 $ 4,207 March 2,356 $ 5,083 Apri April $ 2,857 HI 960 200 360 May June 744 744 20 $1,871 **yor $ 2,696 **3090 $ 4,670 2,108 100 2,406 100 $5,148 September 840 $ 2,691 October 124 $ 1,588 720 1,364 Month July July Quay August November Costs Variable cost of electricity Fixed cost of electricity $2,454 December Required: 1. Using the high-low method, estimate the fixed cost of electricity per month and the variable cost of electricity per occupancy-day. (Do not round your Intermediate calculations. Round your Variable cost answer to 2 decimal places and Fixed cost element answer to nearest whole dollar amount.) $ 3,529 2. What other factors in addition to occupancy-days are likely to affect the variation in electrical costs from month to month? (You may select more than one answer. Single click the box with the question mark to produce a check mark for a correct answer and double click the box with the question mark to empty the box for a wrong answer. Any boxes left with a question mark will be automatically graded as incorrect.) ?Seasonal factors like winter or summer. ?Systematic factors like guests, switching off fans and lights. ? Number of days present in a month. per occupancy-day per month ? Fixed salary paid to hotel receptionist. ? Income taxes paid on hotel income.
Exercise 6A-1 (Static) High-Low Method [LO6-10] The Cheyenne Hotel in Big Sky, Montana, has accumulated records of the total electrical costs of the hotel and the number of occupancy-days over the last year. An occupancy-day represents a room rented for one day. The hotel's business is highly seasonal, with peaks occurring during the ski season and in the summer. Occupancy- Electrical Days January 1,736 $4,127 February 1,904 $ 4,207 March 2,356 $ 5,083 Apri April $ 2,857 HI 960 200 360 May June 744 744 20 $1,871 **yor $ 2,696 **3090 $ 4,670 2,108 100 2,406 100 $5,148 September 840 $ 2,691 October 124 $ 1,588 720 1,364 Month July July Quay August November Costs Variable cost of electricity Fixed cost of electricity $2,454 December Required: 1. Using the high-low method, estimate the fixed cost of electricity per month and the variable cost of electricity per occupancy-day. (Do not round your Intermediate calculations. Round your Variable cost answer to 2 decimal places and Fixed cost element answer to nearest whole dollar amount.) $ 3,529 2. What other factors in addition to occupancy-days are likely to affect the variation in electrical costs from month to month? (You may select more than one answer. Single click the box with the question mark to produce a check mark for a correct answer and double click the box with the question mark to empty the box for a wrong answer. Any boxes left with a question mark will be automatically graded as incorrect.) ?Seasonal factors like winter or summer. ?Systematic factors like guests, switching off fans and lights. ? Number of days present in a month. per occupancy-day per month ? Fixed salary paid to hotel receptionist. ? Income taxes paid on hotel income.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Question
![9:49 A
Month
January
February
March
April
May
June
July
July
August
September
October
November
December
Occupancy-
Days
Exercise 6A-1 (Static) High-Low Method [LO6-10]
The Cheyenne Hotel in Big Sky, Montana, has accumulated records of the total electrical costs of the hotel and the number of
occupancy-days over the last year. An occupancy-day represents a room rented for one day. The hotel's business is highly seasonal,
with peaks occurring during the ski season and in the summer.
1,736
1,904
2,356
960
360
744
100
2,108
406
2,406
840
124
720
1,364
0
KB/s
Variable cost of electricity
Fixed cost of electricity
Electrical
Costs
$4,127
$ 4,207
$5,083
2,857
$ 1,871
$
$
2,696
2.696
$ 4,670
$ 5,148
anscribed Text
$ 2,691
$ 1,588
$ 2,454
$ 3,529
? Seasonal factors like winter or summer.
J
Required:
1. Using the high-low method, estimate the fixed cost of electricity per month and the variable cost of electricity per occupancy-day.
(Do not round your Intermediate calculations. Round your Variable cost answer to 2 decimal places and Fixed cost element
answer to nearest whole dollar amount.)
? Number of days present in a month.
?Fixed salary paid to hotel receptionist.
?Systematic factors like guests, switching off fans and lights.
? Income taxes paid on hotel income.
c
per occupancy-day
per month
2. What other factors in addition to occupancy-days are likely to affect the variation in electrical costs from month to month? (You may
select more than one answer. Single click the box with the question mark to produce a check mark for a correct answer and
double click the box with the question mark to empty the box for a wrong answer. Any boxes left with a question mark will be
automatically graded as Incorrect.)
Vo LTE
LTE
79%
O](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Fa8b2c4e3-b58e-43dd-b0bb-b6b5adcd2b10%2Fa9e89970-98af-4305-acf9-b71fc4839b63%2Fl8l95gf_processed.png&w=3840&q=75)
Transcribed Image Text:9:49 A
Month
January
February
March
April
May
June
July
July
August
September
October
November
December
Occupancy-
Days
Exercise 6A-1 (Static) High-Low Method [LO6-10]
The Cheyenne Hotel in Big Sky, Montana, has accumulated records of the total electrical costs of the hotel and the number of
occupancy-days over the last year. An occupancy-day represents a room rented for one day. The hotel's business is highly seasonal,
with peaks occurring during the ski season and in the summer.
1,736
1,904
2,356
960
360
744
100
2,108
406
2,406
840
124
720
1,364
0
KB/s
Variable cost of electricity
Fixed cost of electricity
Electrical
Costs
$4,127
$ 4,207
$5,083
2,857
$ 1,871
$
$
2,696
2.696
$ 4,670
$ 5,148
anscribed Text
$ 2,691
$ 1,588
$ 2,454
$ 3,529
? Seasonal factors like winter or summer.
J
Required:
1. Using the high-low method, estimate the fixed cost of electricity per month and the variable cost of electricity per occupancy-day.
(Do not round your Intermediate calculations. Round your Variable cost answer to 2 decimal places and Fixed cost element
answer to nearest whole dollar amount.)
? Number of days present in a month.
?Fixed salary paid to hotel receptionist.
?Systematic factors like guests, switching off fans and lights.
? Income taxes paid on hotel income.
c
per occupancy-day
per month
2. What other factors in addition to occupancy-days are likely to affect the variation in electrical costs from month to month? (You may
select more than one answer. Single click the box with the question mark to produce a check mark for a correct answer and
double click the box with the question mark to empty the box for a wrong answer. Any boxes left with a question mark will be
automatically graded as Incorrect.)
Vo LTE
LTE
79%
O
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