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Farmers use alley cropping with nearly level row patterns around hills to prevent soil erosion.
Variable Production Costs
Costs that vary directly with the level of production, such as raw materials and direct labor.
Product Costs
All costs that are involved in acquiring or making a product. In the case of manufactured goods, these costs consist of direct materials, direct labor, and manufacturing overhead. Also see Inventoriable costs.
Absorption Costing
A costing method that includes all manufacturing costs—direct materials, direct labor, and both variable and fixed manufacturing overhead—in unit product costs.
Manufacturing Costs
The total expense involved in the manufacture of a product, including direct materials, direct labor, and manufacturing overhead.
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