The Cheyenne Hotel in Big Sky, Montana, has accumulated records of the total electrical costs of the hotel and the number of occupancy-days over the last year. An occupancy-day represents a room rented out for one day. The hotel's business is highly seasonal, with peaks occurring during the ski season and in the summer. Month Occupancy- Days Electrical Costs January 3,560 $ 6,573 February 3,420 $ 6,209 March 4,120 $ 7,022 April 1,990 $ 5,174 May 430 $ 1,118 June 1,750 $ 4,550 July 3,690 $ 6,687 August 3,970 $ 6,968 September 1,950 $ 5,070 October 1,450 $ 3,770 November 2,050 $ 5,330 December 2,300 $ 5,980

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
Change	0	$0
Variable cost		per occupancy-day
Fixed cost element

2. 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)

Systematic factors like guests, switching off fans and lights.

Number of days present in a month.

Seasonal factors like winter or summer.

Income taxes paid on hotel income.