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What Is the Blind Spot, and Why Does It Occur

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What is the blind spot, and why does it occur?


Definitions:

Labor Hours

A measure of the amount of work performed, calculated by multiplying the number of workers by the number of hours each works.

Milling Department

A division within a manufacturing setup where milling processes are carried out, often involving cutting, shaping, drilling, or finishing products or components.

Direct Method

A cost allocation method used in cost accounting that directly assigns all direct costs to specific cost objects, such as products or services, without using any allocation for indirect costs.

Service Department

A department within a company that provides essential support services to the production and sales departments, not directly generating revenue.

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