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What Are Temporary Accounts and Why Are They Used

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What are temporary accounts and why are they used?


Definitions:

Incremental Cost

The additional cost that is incurred if a certain business decision is made or an action is taken.

Additional Cost

Expenses or charges that may be incurred beyond the initial purchase price or cost projections.

Incremental Overhead

Additional overhead costs that arise from new activities or an increase in production beyond normal operations.

Variable Costs

Costs that vary directly with the level of production or the volume of services provided.

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