Asked by Mbilla Mwololo on May 14, 2024
Verified
Which of the following is an advantage of the high-low method
A) It enables the analysis to determine whether or not the data points are linear.
B) Iit eliminates most of the data points.
C) All data points are used in the analysis.
D) It is quick and easy to apply.
High-Low Method
A technique used in cost accounting to determine the variable and fixed components of a company's cost structure by analyzing the highest and lowest levels of activity.
- Understand the application and limitations of the high-low method in cost estimation.
Verified Answer
CA
Chuchi AlfaroMay 15, 2024
Final Answer :
D
Explanation :
The high-low method is advantageous because it is quick and easy to apply, making it a simple way to estimate the variable and fixed components of a cost structure.
Learning Objectives
- Understand the application and limitations of the high-low method in cost estimation.
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