High-Low Method: Cost Behavior

by | Feb 9, 2023 | Bookkeeping

In cost accounting, the high-low method is a technique used to split mixed costs into fixed and variable costs. Although the high-low method is easy to apply, it is seldom used because it can distort costs, due to its reliance on two extreme values from...

Aging: Definition in Accounting, Uses, Report Example

by | Jan 27, 2023 | Bookkeeping

Running the report prior to month-end billing includes fewer AR and shows little cash coming in, when, in reality, much cash is owed. Accounts receivable aging is useful in determining the allowance for doubtful accounts. When estimating the amount of bad debt to...