Which of the Following Is Not a Step in Estimating

question 29

Multiple Choice

Which of the following is not a step in estimating total cost using the high-low method?

• A)Identify the highest and lowest levels of activity.
• B)Visually "fit" a line to the plotted points.
• C)Compute the variable cost per unit.
• D)Calculate the fixed cost using either the high point or the low point.

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Definitions:

Indirect Costs

Costs that are not identified with or traced to a cost object.

Cost Drivers

Factors that cause a change in the cost of an activity, ultimately affecting the overall expenses associated with production or operations.

Janitorial Services

Professional cleaning and maintenance services performed in office buildings, schools, hospitals, and other facilities.

Support Department Costs

Expenses related to departments that do not directly engage in manufacturing but provide essential support to production departments, like maintenance and administration.