Lancelot Group of Companies would like to estimate its cost function for proper cost management across its business lines. The newly hired cost accountant, though aware that high and low method is technique that is used to estimate cost function, he is unsure of its application. Which of the following statements will best describes accounts classification to the accountant?

• A. This entails selecting the high and low costs with their corresponding activity levels
• B. This involves selecting the high and low levels of activity with their corresponding total cost and the variable cost per unit is derived by dividing the change in activity level by the change in cost
• C. This involves selecting the high and low output levels and their associated total cost to calculate variable cost per unit as change in cost divided by change in output levels.
• D. This involves selecting any two points from the data and calculating variable cost per unit as change in cost divided by change in activity level