Question

	Problem 1.
	The Jedi Hotel has been tracking its property repairs and maintenance costs (PR&M) over the past year. The results were as follows for the year:
	The Jedi Hotel
	Month	Activity (Room Nights Sold)	PR&M Costs
	January	2050	$6,180
	February	2800	$7,195
	March	3200	$7,564
	April	3800	$7,840
	May	4100	$8,763
	June	4350	$10,700
	July	4700	$11,161
	August	4900	$11,991
	September	4500	$10,977
	October	3300	$7,656
	November	2700	$7,102
	December	2400	$6,641
	Required:
	Using the high-low two point method:
	1. Calculate the variable cost per room night sold.
	2. Calculate the monthly fixed PR&M cost.
	3. Estimate the total amount that the Jedi Hotel will spend on PR&M cost when the forecasted activity level for the month is: 9224 room nights

Answer 1

The answer has been presented in the supporting sheet. For detailed answer refer to the supporting sheet.