Reference no: EM132707916

The Lakeshore Hotel's occupancy-days and custodial supplies expense over the last seven months were as follows:

Month         Occupancy Days             Custodial Supplies Expense

March            18,300                      $16,700

April              12,740                        $17,250

May              15,360                           $19,000

June                29,400                          $23,350

July                25,800                             $26,000

August                 18,000                           $20,750

September            15,100                             $20,000

Problem 1: 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. Using the High-Low Method, what is the variable cost portion of the cost equation going to be?

A) $0.366

B) $0.558

C) $1.240

D) $0.813

E) $0.599