Through using the high-low method regency hotels estimates, Ask an Expert

Accounting

Through using the high-low method, Regency Hotels estimates the total costs of providing room service meals to amount to $5,950 per month, plus 30 percent of room service revenue.

Required:

(a)What is the contribution margin ratio of providing room service meals? (Omit the "%" sign in your response.)

Contribution margin ratio 70%

(b)What is the break-even point for room service operations in terms of total room service revenue?

(Omit the "tiny_mce_markerquot; sign in your response.)

Break-even point $

(c)What would you expect to be the total cost of providing room service in a month in which room service revenue amounts to $15,000? (Omit the "tiny_mce_markerquot; sign in your response.)

Total Cost $

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Accounting Basics, Accounting

Category:- Accounting Basics
Reference No.:- M9801101

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