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Absorption Costing
An approach to costing that encompasses all costs associated with manufacturing, including direct materials, direct labor, as well as variable and fixed manufacturing overheads, in the product cost.
Absorption Costing
A strategy in accounting practice that aggregates all manufacturing expenses, from direct materials and labor to variable and fixed overheads, into the determination of a product's cost.
Break-Even Sales
The amount of revenue required to cover both the variable and fixed costs of a business, indicating no profit and no loss.
Contribution Margin
The amount by which the sale of a product exceeds its variable costs, contributing to covering fixed costs and generating profit.
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