Question: 1 . 5 . Semi - Variable Costs The Lakeshore Hotel s guest - days of occupancy and custodial supplies expense over the last seven

1.5. Semi-Variable Costs The Lakeshore Hotels guest-days of occupancy and custodial supplies expense over the last seven months were: Month Guest-Days of Occupancy Custodial Supplies Expense March 4,000 Rs7,500 April 6,500 Rs8,250 May 8,000 Rs10,500 June 10,500 Rs12,000 July 12,000 Rs13,500 August 9,000 Rs10,750 September 7,500 Rs9,750 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. Required: 1. Using the high-low method, estimate a cost formula for custodial supplies expense. 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 11,000 guest-days?

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