If the controller uses the high-low method to estimate costs,the cost equation for administrative salaries is:
A)Cost = $96,409.42 + $103.56 $\times$ Credit-hours.
B)Cost = $69,474.40 + $114 30 $\times$ Credit-hours.
C)Cost = $201.21 $\times$ Credit-hours.
D)Cost = $198,808.

Question

Quizplus · Accepted Answer

The high-low method calculates the variable cost per unit and the fixed cost by using the highest and lowest activity levels. The equation in choice B reflects both a fixed cost component and a variable cost per credit-hour.

If the Controller Uses the High-Low Method to Estimate Costs,the ×\times×

If the Controller Uses the High-Low Method to Estimate Costs,the $\times$