304 PM eztomheducationcom TMobile LTE 77 5 1000 points The L

3:04 PM ezto.mheducation.com T-Mobile LTE 77% 5· 1000 points The Lakeshore Hotel\'s guest-days of occupancy and custodial supplies expense over the last seven months were: 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 1. Using the high-low method, estimate a cost formula for custodial supplies expense (Do not round your intermediate calculations and 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 12,400 guest-days? (Do not round your intermediate c 3. Prepare a scattergraph using the data given above. (Place custodial supplies expense on the vertical axis and guest-days on the horizontal axis. Round your plotting points to the nearest hundredth value.) Instructions: 1. On the graph below, use the point tool (Mar) to plot custodial supplies expense on the vertical axis and guest-days on the horizontal axis 2. Repeat the same process for the plotter tools (Apr, May, June, July, Aug, Sep). 3. To enter exact coordinates, click on the point and enter the values of x and y 4. To remove a point from the graph, click on the point and select delete option.

Solution

1)

Variable Cost perguest day :-

= Change in Cost / Change in activity

= $3600 / 6000

= $0.6 per guest day

Fixed Cost Per Month :-

= Total Cost - Variable cost

= $15600 - (14000*$0.6)

= $15600 - $8400

= $7200

2). Calculate Costs at an occupancy level of 12400 guest days.

Total Cost = Fixed Cost + Variable Cost

= $7200 + (12400 * $0.6)

= $7200 + $7440

= $14640

Particulars	Guest Days	Custodial Supplies Expense
High Activity Level	14000	$15600
Low Activity Level	8000	$12000
Change	6000	$3600
Variable cost per guest day	$0.6	Per Guest Day
Fixed Cost per month	$7200