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During the precontemplative stage, the client will:
Variable Costing
Variable Costing is an accounting method that only assigns variable costs to inventory, treating fixed costs as period expenses.
Contribution Margin
The amount remaining from sales revenue after variable costs have been deducted, indicating how much contributes to covering fixed costs.
Total Gross Margin
This is the difference between sales revenue and the cost of goods sold, before deducting administrative and selling expenses.
Absorption Costing
An accounting method that includes both variable and fixed production costs in the cost of goods sold.
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