The High-Low Method Differs from the Scattergraph in That the High-Low

question 81

Multiple Choice

The high-low method differs from the scattergraph in that the high-low method

• A)is simple to prepare and interpret whereas the scattergraph requires the use of statistical techniques.
• B)is less costly than the scattergraph method.
• C)uses a statistical technique to estimate the cost components.
• D)requires only two data points - the lowest point of activity and the highest point of activity.

---

Definitions:

Trial Balance

A report listing all the accounts and their balances at a specific point in time, used to ensure that debits equal credits.

Accounts Receivable

The sum customers owe a company for the delivery of services or products, payment for which has not yet been made.

Accounts Payable

Amounts owed by a company to suppliers or vendors for goods or services received but not yet paid for, recognized as a current liability on the balance sheet.

General Journal

A primary accounting record where financial transactions are entered before posting to ledger accounts.