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1.(25 points) The Beach Hotel is concerned with controlling its custodial costs at the hotel, which are directly related to the number of guest-days of
1.(25 points) The Beach Hotel is concerned with controlling its custodial costs at the hotel, which are directly related to the number of guest-days of occupancy. The hotel collected the following data on custodial costs and guest-days of occupancy (over seven recent months). Month Guest-Days of Occupancy 4,000 March April May 6,500 8,000 Custodial Expenses $7,500 $8,250 $10.500 $12.000 June 10.500 $13,500 July August September 12,000 9,000 $10,750 $9.750 7,500 a. Based on these activity values, what is the relevant range? b. Use the High-Low Method to calculate the mixed cost equation? c. Using your High-Low Method mixed cost equation, if the guest-days of occupancy is expected to be 10.000 days, what is the estimated custodial costs
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