The high-low method uses cost and activity data from just two periods to establish a cost formula

Question

Quizplus · Accepted Answer

The high-low method is a technique used to separate mixed costs into their fixed and variable components by analyzing data from two periods – a period of high activity and a period of low activity. By using this data, a cost formula can be determined which helps in predicting costs for different levels of activity. Therefore, the statement is true.

The High-Low Method Uses Cost and Activity Data from Just