A Method That Estimates Cost Behavior by Connecting the Costs

question 96

Multiple Choice

A method that estimates cost behavior by connecting the costs linked to the highest and lowest volume levels on a scatter diagram with a straight line is called the:

• A) Scatter method.
• B) High-low method.
• C) Least-squares method.
• D) Break-even method.
• E) Step-wise method.

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Definitions:

Consumer

An individual who purchases goods or services for personal use rather than for manufacturing or resale.

Lost Check

A check that has been misplaced, destroyed, or otherwise lost, potentially leading to the issuance of a stop payment order and requiring a replacement.

Drawer

In banking and finance, the person who writes or issues a check or draft instructing the bank to pay a specified amount of money to a designated party.

Drawee

The party in a financial transaction who is directed to pay a certain sum of money as per the payer's instructions.