When using the high-low method, the two observations used are the high and low observations of the ________.
A) cost driver
B) fixed cost component
C) slope coefficient
D) direct cost

Question

Quizplus · Accepted Answer

The high-low method is used to separate mixed costs into their fixed and variable components. The two observations used are the highest and lowest levels of the cost driver, which is the variable that drives the mixed cost. Therefore, the correct answer is A) cost driver.

When Using the High-Low Method, the Two Observations Used Are