Given actual amounts of a semi-variable cost for various levels of output, the method that will always give the most reliable measure of the fixed and variable components is the:
A) high-low method.
B) linear regression method.
C) scattergraph method.
D) account analysis method.

Question

Quizplus · Accepted Answer

The linear regression method provides the most reliable measure of fixed and variable components because it uses all data points to statistically determine the best-fitting line, minimizing errors and providing a more accurate estimate compared to other methods.

Given Actual Amounts of a Semi-Variable Cost for Various Levels