Answered step by step
Verified Expert Solution
Question
1 Approved Answer
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
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 for one day. The hotels business is highly seasonal, with peaks occurring during the ski season and in the summer.
Month | Occupancy-Days | Electrical Costs |
---|---|---|
January | 3,180 | $ 6,510 |
February | 2,920 | $ 6,261 |
March | 3,780 | $ 7,392 |
April | 2,160 | $ 5,569 |
May | 650 | $ 1,820 |
June | 2,050 | $ 5,261 |
July | 4,050 | $ 7,829 |
August | 4,070 | $ 7,896 |
September | 1,780 | $ 4,984 |
October | 570 | $ 1,596 |
November | 1,580 | $ 4,424 |
December | 2,680 | $ 5,908 |
Using the high-low method, estimate the fixed cost of electricity per month and the variable cost of electricity per occupancy-day.
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started