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Assignment for Management Accounting There are three types of costs

Assignment for Management Accounting
There are three types of costs: Fixed, Variable, and Mixed Costs. A mixed cost comprises of both a fixed cost and a variable cost. A fixed cost doesn’t change during any activity of buying or selling, while the variable cost changes during the activity is made. The High-Low Method is a technique used for classifying a mixed cost into variable and fixed costs. An example of a mixed cost is a cost for electricity power for a house. The fixed cost is the amount that is paid every month regardless of how much electricity is consumed and is always the same. However, the variable cost depends on how much electricity is consumed and cost varies. There are two steps involved in using the High-Low Method:

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