Question

Required information Camp Rainbow offers overnight summer camp programs for children ages 10–14 every summer during June and July. Each camp session is one week and can accommodate up to 200 children. The camp is not coed, so boys attend during the odd-numbered weeks and girls attend during the even-numbered weeks. While at the camp, participants make crafts, participate in various sports, help care for the camp's resident animals, have cookouts and hayrides, and help assemble toys for local underprivileged children. The camp provides all food as well as materials for all craft classes and the toys to be assembled. One cabin can accommodate up to 10 children, and one camp counselor is assigned to each cabin. Three camp managers are on-site regardless of the number of campers enrolled. Following is the cost information for Camp Rainbow's operations last summer: Week 1 2 들 3 Number of Cost to Run Campers Camp 158 $12,910 184 13,090 156 12,850 106 8,060 194 14,000 112 9, 280 166 12,630 154 11,370 6 7 8 Required: 4. Using the high-low method, calculate Camp Rainbow's total fixed operating costs and variable operating cost per child. 5. Using the high-low method results, calculate the camp's expected operating cost if 166 children attend a session.

Answer 1

Variable cost = (Cost at highest activity - Cost at lowest activity)/(Highest activity-Lowest activity)

= (14,000-8,060)/(194-106)

= 67.50

Fixed cost = Total cost - Total Variable cost

= 14,000 - (67.50*194)

= 905

Fixed cost	905
Variable cost per child	67.50

.

Expected cost

= (67.50*166) + 905

= 12,110