Learn how to use the High-Low Method to separate fixed and variable costs efficiently. Discover its applications, limitations, and how to calculate costs.

The high-low method is used in cost accounting to estimate fixed and variable costs based on a business's highest and lowest levels of activity. By focusing on these extremes, the high-low method ...

Managerial accounting, a tool used for business decision-making, allows for different methods of calculating net income. The general formula is that sales minus costs equals net income, but there are ...

A business can be surprised – rudely or pleasantly – when fixed costs don't remain fixed. When accounting for the costs of products and services, a company assumes that certain costs remain fixed as ...

For example, think about two types of expenses: fixed costs and variable costs. Fixed costs are those that don't change as the number of units you sell grows. For example, if you are a retail store, ...