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Operating Income
The financial gain obtained through the main functions of a firm, without considering the reductions for interest and taxes.
Absorption Costing
An approach in accounting that adds up all costs associated with manufacturing, including direct materials, workforce expenses, and all overhead costs, both variable and fixed, into the product pricing.
Variable Costing
An accounting method that only includes variable production costs (direct materials, direct labor, and variable manufacturing overhead) in product costs.
Operating Income
The profit realized from a business's core operations, excluding taxes and interest expenses.
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