Costs $6,750 $7,410 $7,905 $5,520 $2,250 $5,490 $8,190 $5,100 $8,410 January Feb
ID: 2406986 • Letter: C
Question
Costs $6,750 $7,410 $7,905 $5,520 $2,250 $5,490 $8,190 $5,100 $8,410 January February 2,830 3,340 3,650 1,840 750 1,830 3,890 1,700 4,060 2,260 1,350 April August September $4,050 870 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) Occupancy Electrical Days Costs High activity level Low activity level Variable cost per occupancy-day Fixed cost element What other factors other than occupancy-days are likely to affect the variation in electrical costs from month to month? (You may select more than one answer. Boxes left with question marks will 2. graded as incorrect.) ?Income taxes paid on hotel income. ?systematic factors like guests, switching off fans and lights. Number of days present in a month 1 Seasonal factors like winter or summerExplanation / Answer
1 Occupancy days Electrical costs High activity level 4060 8410 Low activity level 290 870 Change 3770 7540 Variable cost 2 (7540/3770) Fixed cost element 290 =8410-(4060*2) 2 Systematic factors like guests, switching off fans and lights Number of day present in a month Seasonal factors like winter or summer