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West Coast Hotel has 1 5 0 rooms. The occupancy rate varies between 5 0 % and 9 0 % per month, but the average

West Coast Hotel has 150 rooms. The occupancy rate varies between 50% and 90% per month, but the average occupancy rate is generally 80%. In other words, on average, 80% of the hotels rooms are occupied by guests. At this level of occupancy, the hotels operating costs are $86 per occupied room per day, assuming a 30-day month. This $86 figure contains both variable and fixed cost elements. This average cost figure drops to $81 when the occupancy rate is 90%(typically during the months of July and August).
During June, the hotels occupancy rate was only 50% and a total of $260,400 in operating costs was incurred during the month. Using the high-low method, estimate the total fixed operating costs per month. 2. Assume an occupancy rate of 70% per month. What amount of total operating cost would you expect the hotel to incur?

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