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Variable Component
A part of cost or expense that fluctuates with changes in production volume or activity level.
Fixed Component
Part of a company's costs that do not change with the level of production or sales, such as rent, salaries, and insurance.
Predetermined Overhead Rate
A rate used to allocate overhead costs to products or services, calculated based on estimated costs and activity levels before the actual costs are known.
Overhead Efficiency
The effectiveness with which a company utilizes its overhead, often analyzed through the comparison of actual overhead costs with budgeted or standard costs.
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