Explain the Difference Between Index and Intermediate Con- Tour Lines

question 12

Essay

Explain the difference between index and intermediate con- tour lines.

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Definitions:

Predetermined Overhead Rate

An estimated rate used to assign manufacturing overhead costs to individual products or job orders, calculated before the actual costs are known.

Capacity

The maximum level of output that a company can sustain to produce goods or services.

Estimated Activity

An approximation of the level of operational or production activity expected in a certain period, typically used for budgeting and costing.

Unused Capacity

The portion of a company's production or operational potential that is not currently being utilized.