Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Beaches Resort is an all-inclusive resort located in the Caribbean. The business is highly seasonal, with peaks occuring during spring and late fall. Following is

image text in transcribed

Beaches Resort is an all-inclusive resort located in the Caribbean. The business is highly seasonal, with peaks occuring during spring and late fall. Following is the data for the past year of the resort's total electrical costs and the number of occupancy days. Month January February March April May June July August September October November December Occupancy-Days 3,410 3,250 4,470 1,940 1,050 450 3,270 4,510 1,350 1,640 1,860 2,970 Electrical Costs $ 13, 889 $13,000 $15, 158 $ 8,342 $ 4,515 $ 1,935 $13,094 $15, 333 $ 5,805 $ 7,052 $ 7,998 $ 12,578 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.) Variable cost of electricity Fixed cost of electricity per occupancy-day per month 2. What other factors in addition to occupancy-days are likely to affect the variation in electricity costs from month to month? (You may select more than one answer. Single click the box with the question mark to produce a check mark for a correct answer and double click the box with the question mark to empty the box for a wrong answer. Any boxes left with a question mark will be automatically graded as incorrect.) Systematic factors like guests, switching off fans and lights. Number of days present in a month. Income taxes paid on hotel income, 7 Seasonal factors like winter or summer. Fixed salary paid to hotel receptionist

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

IRS Audit Protection And Survival Guide Bed And Breakfasts

Authors: Gerald F. Bernard, Daniel J. Baran

1st Edition

0471166340, 978-0471166344

More Books

Students also viewed these Accounting questions