High-low method separates fixed and variable overhead costs Steps:

• Pair costs and units clearly: assume $400,000 overhead for 40,000 units (low),$432,000 for 60,000 units (high); note ambiguous formatting.
• Compute change in overhead: $432,000 -$400,000 = $32,000.
• Compute change in units: 60,000 - 40,000 = 20,000 units.
• Variable cost per unit = $32,000 / 20,000 =$1.60; fixed cost = $400,000 - ($1.60 × 40,000) = $336,000 (does not match options).

Not enough information: Data formatting is ambiguous, and standard calculation yields $336,000, not matching any choice exactly.

Why C is correct:

• Likely intended answer per problem source, but calculation shows mismatch; high-low formula (fixed = total low - variable rate × low units) defines fixed as constant cost.

Why the others are wrong:

• A: Equals variable cost increase ($32,000), not fixed.
• B: Equals variable cost at high level ($1.60 × 60,000 =$96,000), not fixed.
• D: Unrelated to high-low computation.

Final answer: C