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Managerial Accounting

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High-Low Method: Choosing Observations

MGRACT-YFYQ4L

When using the high-low method of cost estimation, the two observations used are:

A

the observation with the highest value of the independent variable and the observation with the lowest value of the independent variable.

B

the observation with the highest value of the dependent variable and the observation with the lowest value of the dependent variable.

C

the observation with the highest value of the independent variable and the observation with the lowest value of the dependent variable.

D

the observation with the lowest value of the dependent variable and the observation with the highest value of the independent variable.