A Disadvantage of the High-Low Method of Cost Analysis Is

question 85

Multiple Choice

A disadvantage of the high-low method of cost analysis is that:

• A) it cannot be used when there are a very large number of observations.
• B) it is too time consuming to apply.
• C) it uses two extreme data points, which may not be representative of normal conditions.
• D) it relies totally on the judgment of the person performing the cost analysis.

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Definitions:

Denying the Antecedent

A logical fallacy involving an invalid argument structure where, from the premise that if P then Q, it is inferred that if not P then not Q.

Taste Better

A subjective assessment indicating that one item is perceived as more pleasing or enjoyable in flavor than another.

Disjunctive Syllogism

A form of logical reasoning where, from two possibilities, the elimination of one implies the necessity of the other.

Valid Argument

A logical conclusion based on premises that are true and follows a form that guarantees its truth.