Prove That the Identity Is True

question 18

Essay

Prove that the identity is true.
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Definitions:

Actual Sales

The exact amount of sales revenue that a company has generated over a specific period, as opposed to projected or forecasted sales.

High-Low Method

A technique used in cost accounting to estimate fixed and variable costs based on the highest and lowest levels of activity.

Mixed Cost

Mixed cost refers to a cost that contains both variable and fixed cost elements, meaning it changes with the level of activity but not directly proportionate.

Activity Level

The volume of work or output produced, often used in costing and budgeting processes to measure levels of operations.