Using the cost formula you derived above what amount of

Assignment Help Accounting Basics

Reference no: EM13598005

The Lakeshore Hotel's guest-days of occupancy and custodial supplies expense over the last seven months were:
Month Guest-Days of Custodial Supplies
Occupancy Expense

March 2,800 $17,400
April 4,490 $22,500
May 5,040 $23,000
June 4,260 $19,900
July 7,070 $31,918
August 7,000 $27,600
Sept 3,000 $18,100

Guest-days is a measure of the overall activity at the hotel. For example, a guest who stays at the hotel for three days is counted as three guest-days.

1. Using the high-low method, estimate a cost formula for custodial supplies expense where X is the number of guest-days.

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 4,610 guest-days?

Reference no: EM13598005

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