Montana Co. has determined its year-end inventory on a FIFO basis to be $632,000. Information pertaining to that inventory is as follows: Selling price $ 600,000
Costs to sell 33,000
Replacement cost 542,000

Suppose a holiday inn hotel has annual fixed costs applicable to its rooms of $1.2 million for its 300-room hotel, average daily room rents of $50, and average variable costs of $10 for each room rented. it operates 365 days per year. the amount of operating income on rooms, assuming an occupancy* rate of 80% for the year, that will be generated for the entire year is *occupancy = % of rooms rented