ACCT 2230 Lecture 6: Chapter 6 solutions
30 Sep 2015
School
Department
Course
Professor
Document Summary
Exercise 6-1 (15 minutes) served increases because the fixed cost is spread over more units. * total cost smoothies served in a week: the average cost of a smoothie declines as the number of smoothies. Variable cost = change in cost change in activity. Variable cost element (. 87 per occupancy-day 3,608 occupancy-days) . Fixed cost element ,364: electrical costs may reflect seasonal factors other than just the variation in occupancy days. For example, common areas such as the reception area must be lighted for longer periods during the winter. This will result in seasonal effects on the fixed electrical costs. Additionally, fixed costs will be affected by how many days are in a month. In other words, costs like the costs of lighting common areas are variable with respect to the number of days in the month, but are fixed with respect to how many rooms are occupied during the month.
