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Module 3: Decision Making
(Cost Estimation/Prediction Methods)
High-low Method Procedures:

Step 1. Identify the high and low activity levels from the data
The highest level of activity (level of production) occurred in

the month of April (5,900 units; $380,000 production costs),
and the lowest level of activity occurred in the month of
January (2,900 units; $200,000 production costs).

Step 2. Calculate the variable cost per unit (v).

Step 3. Calculate the total fixed cost (f).
Simply select either the high or low activity level