In applying the high-low method, what is the fixed cost? $\begin{array}{llr}\text { Month}& \text { Miles }& \text { Total Cost }\\hline
\text { January } & 80,000 & \$ 192,000 \
\text { February } & 50,000 & 160,000 \
\text { March } & 70,000 & 188,000 \
\text { April } & 90,000 & 260,000
\end{array}$

Question

In applying the high-low method, what is the fixed cost? $\begin{array}{llr}\text { Month}& \text {  Miles }& \text { Total Cost }\\hline
\text { January } & 80,000 & \$ 192,000 \
\text { February } & 50,000 & 160,000 \
\text { March } & 70,000 & 188,000 \
\text { April } & 90,000 & 260,000
\end{array}$

Quizplus · Accepted Answer

The fixed cost is the cost that remains constant regardless of the level of activity. In this case, the fixed cost is $35,000, which is the difference between the total cost at the highest level of activity (90,000 miles) and the total cost at the lowest level of activity (50,000 miles).

In Applying the High-Low Method, What Is the Fixed Cost