When Using the High-Low Method, the Variable Cost Per Unit

question 341

Multiple Choice

When using the high-low method, the variable cost per unit can be found as the

• A) run over rise.
• B) rise over run.
• C) change in volume over change in cost.
• D) vertical intercept.

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Definitions:

Functional Currency

The primary currency of the primary economic environment in which an entity operates.

Depreciation

The systematic allocation of the cost of a tangible asset over its useful life, reflecting wear and tear, deterioration, or obsolescence.

Amortization

The process of gradually writing off the initial cost of an asset over a period.

Non-Monetary Items

Items on the balance sheet not easily converted to cash, often valued at historical cost, such as property, plant, and equipment.