High-low method

High-low method is method used to estimate a cost function that uses only the highest and lowest observed values of the cost driver within the relevant range and their respective costs.

Definitions

According to Cost Accounting by Horngren, Datar, Rajan (14th edition),

High-low method. Method used to estimate a cost function that uses only the highest and lowest observed values of the cost driver within the relevant range and their respective costs.

According to Managerial Accounting by Braun, Tietz (5th edition),

High-low method. A method for determining cost behavior that is based on two historical data points: the highest and lowest volume of activity.