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High-Low Method Luisa Crimini has been operating a beauty shop in a college town for the past 10 years. Recently, Luisa rented space next to
High-Low Method Luisa Crimini has been operating a beauty shop in a college town for the past 10 years. Recently, Luisa rented space next to her shop and opened a tanning salon. She anticipated that the costs for the tanning service would primarily be fixed but found that tanning salon costs increased with the number of appointments. Costs for this service over the past eight months are as follows Tanning Appointments Month Total Cost 1,600 2,000 3,500 2,500 1,500 2,300 2,150 3,000 $1,754 2,140 2,790 2,400 1,790 2,275 2,200 2,640 January February March April May June July August Required: 1. Which month represents the high point? The low point? High point Low point 2. Using the high-low method, compute the variable rate for tanning. Compute the fixed cost per month. Round the variable rate per tanning appointment to the nearest cent. Variable rate for tanning Fixed cost per month 3. Using the variable rate and fixed cost, what is the cost formula for tanning services? per tanning appointment
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