contestada

The Lakeshore Hotel's guest-days of occupancy and custodial supplies expense over the last seven months were: 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.
(a) Using the high-low method, estimate a cost formula for custodial supplies expense.

Respuesta :

In cost accounting, the high-low method is a way of attempting to separate out fixed and variable costs given a limited amount of data. The high-low method involves taking the highest level of activity and the lowest level of activity and comparing the total costs at each level.

Particulars                  Guest Days                       Custodial Supplies Expense

High Activity Leve l 11500                                  12600

Low Activity Level   5500                                       10200

Change                        6000                                  2400

Variable cost per

guest day                0.4  

Fixed Cost per                

month                         8000  

   

Total Cost = Total Variable cost + Total Fixed Cost    

10200 = (5500*0.40) + Total Fixed Cost    

Total Fixed Cost = 10200-2200    

Total Fixed Cost = 8000

To learn more about high-low method visit:  https://brainly.com/question/14107176

#SPJ4

Otras preguntas