The Lakeshore Hotel’s guest-days of occupancy and custodial supplies expense over the last seven months were: Month Guest-Days of Occupancy Custodial Supplies Expense March 7,000 $ 10,200 April 6,500 $ 10,100 May 9,000 $ 10,600 June 10,500 $ 10,900 July 12,500 $ 11,300 August 11,500 $ 11,100 September 9,000 $ 10,600 Guest-days is a measure of the overall activity at the hotel. For example, a guest who stays at the hotel for three days is counted as three guest-days. Required: 1. Using the high-low method, estimate a cost formula for custodial supplies expense. (Round the Variable cost per guest-day to 2 decimal points.) 2. Using the cost formula you derived above, what amount of custodial supplies expense would you expect to be incurred at an occupancy level of 11,300 guest-days? (Do not round your intermediate calculations.)
The Lakeshore Hotel’s guest-days of occupancy and custodial supplies expense over the last seven months were: Month Guest-Days of Occupancy Custodial Supplies Expense March 7,000 $ 10,200 April 6,500 $ 10,100 May 9,000 $ 10,600 June 10,500 $ 10,900 July 12,500 $ 11,300 August 11,500 $ 11,100 September 9,000 $ 10,600 Guest-days is a measure of the overall activity at the hotel. For example, a guest who stays at the hotel for three days is counted as three guest-days. Required: 1. Using the high-low method, estimate a cost formula for custodial supplies expense. (Round the Variable cost per guest-day to 2 decimal points.) 2. Using the cost formula you derived above, what amount of custodial supplies expense would you expect to be incurred at an occupancy level of 11,300 guest-days? (Do not round your intermediate calculations.)
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Question
|
The Lakeshore Hotel’s guest-days of occupancy and custodial supplies expense over the last seven months were: |
| Month | Guest-Days of Occupancy |
Custodial Supplies Expense |
|
| March | 7,000 | $ | 10,200 |
| April | 6,500 | $ | 10,100 |
| May | 9,000 | $ | 10,600 |
| June | 10,500 | $ | 10,900 |
| July | 12,500 | $ | 11,300 |
| August | 11,500 | $ | 11,100 |
| September | 9,000 | $ | 10,600 |
|
|
|
Guest-days is a measure of the overall activity at the hotel. For example, a guest who stays at the hotel for three days is counted as three guest-days. |
| Required: | |
| 1. |
Using the high-low method, estimate a cost formula for custodial supplies expense. (Round the Variable cost per guest-day to 2 decimal points.) |
| 2. |
Using the cost formula you derived above, what amount of custodial supplies expense would you expect to be incurred at an occupancy level of 11,300 guest-days? (Do not round your intermediate calculations.) |
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