St marks hospital contains 450 beds the average occupancy

Reference no: EM13597664

St. Mark's Hospital contains 450 beds. The average occupancy rate is 80% per month. In other words, on average, 80% of the hospital's beds are occupied by patients. At this level of occupancy, the hospital's operating costs are $32 per occupied bed per day, assuming a 30-day month. This $32 figure contains both variable and fixed cost elements

(a) Estimate the variable cost per occupied bed on a daily basis using the high-low method.

(b) Estimate the total fixed operating costs per month using the high-low method.

Assume an occupancy rate of 70% per month. What amount of total operating cost would you expect the hospital to incur?

Fixed costs $
Variable costs
Total expected costs $

Reference no: EM13597664

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