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The Lakeshore Hotel's occupancy-days and custodial supplies expense over the last seven months were as follows: Occupancy-days are a measure of the overall activity at
The Lakeshore Hotel's occupancy-days and custodial supplies expense over the last seven months were as follows: Occupancy-days are a measure of the overall activity at the hotel. For example, when a guest stays at the hotel for three days, it is counted as three occupancy-days. Required: 1. Using the high-low method, estimate a cost formula for custodial supplies expense. (Round the "Fixed cost" to the nearest dolla amount and "Variable cost" to 2 decimal places.) 2. Using the cost formula you derived above, what amount of custodial supplies expense would you expect to be incurred at an occupancy level of 13,400 occupancy-days? (In your computations, round "Variable cost per unit" to 2 decimal places and final answers to the nearest dollar amount.)
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