When using the high-low method,the accountant assumes the fixed portion of mixed costs to be the lowest fixed amount incurred during the period under review.

Question

Quizplus · Accepted Answer

The high-low method estimates the fixed portion of mixed costs by analyzing the highest and lowest levels of activity and their corresponding total costs, focusing on the variable cost per unit, not directly on identifying the lowest fixed cost amount.

When Using the High-Low Method,the Accountant Assumes the Fixed Portion