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Exercise 5A-1 High-Low Method (LO5-10] The Cheyenne Hotel in Big Sky, Montana, has accumulated records of the total electrica2. What other factors in addition to occupancy-days are likely to affect the variation in electrical costs from month to mont

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Answer #1
1
Occupancy days Electrical costs
High level 2406 5148
Low level 124 1588
Change 2282 3560
Variable cost of electricity 1.56 per occupancy day =3560/2282
Fixed cost of electricity 1395 per month =5148-(2406*1.56)
2
The other factors are:
Seasonal factors like winter or summer
Systematic factors like guests,switching off fans and lights
Number of days present in a month
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