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Absorption Costing
An approach in financial accounting that wraps all expenses incurred in manufacturing including direct materials, direct labor, and all overhead (variable and fixed), into the product's cost.
Net Operating Income
The total revenue of a business minus its operating expenses, excluding taxes and interest.
Absorption Costing
An accounting method that includes all manufacturing costs - direct materials, labor, and both variable and fixed overhead - in the cost of a product.
Net Operating Income
An entity’s income after all operating expenses have been deducted from total revenue, excluding taxes and interest charges.
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