The Peak View Hotel's occupancy-days and custodial supplies expense over the last seven months were as follows: Occupancy Custodial Supplies Month Days Expense March 19,900 $24,280 April 14,400 23,735 May 16,900 22,815 June 31,400 31,995 July 25,900 29,285 August 20,900 25,030 September 16,400 23,505 Occupancy-days are a measure of the overall activity at the hotel. For example, when a guest stays at the hotel for three days, it is counted as three occupancy-days. Required: 1. Using the high-low method, estimate a cost formula for custodial supplies expense. (Round the "Fixed cost" to the nearest dollar amount and "Variable cost" to 2 decimal places.) Y= 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 15,800 occupancy-days? (In your computations, round "Variable cost per unit" to 2 decimal places and final answers to the nearest dollar amount.) Variable cost Fixed cost Total cost Amount

The Peak View Hotel's occupancy-days and custodial supplies expense over the last seven months were as follows: Occupancy Custodial Supplies Month Days Expense March 19,900 $24,280 April 14,400 23,735 May 16,900 22,815 June 31,400 31,995 July 25,900 29,285 August 20,900 25,030 September 16,400 23,505 Occupancy-days are a measure of the overall activity at the hotel. For example, when a guest stays at the hotel for three days, it is counted as three occupancy-days. Required: 1. Using the high-low method, estimate a cost formula for custodial supplies expense. (Round the "Fixed cost" to the nearest dollar amount and "Variable cost" to 2 decimal places.) Y= 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 15,800 occupancy-days? (In your computations, round "Variable cost per unit" to 2 decimal places and final answers to the nearest dollar amount.) Variable cost Fixed cost Total cost Amount

Survey of Accounting (Accounting I)

8th Edition

ISBN:9781305961883

Author:Carl Warren

Publisher:Carl Warren

Chapter13: Budgeting And Standard Costs

Section: Chapter Questions

Problem 13.6.2MBA

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