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Activity Base
A measure used in costing, representing a unit of activity that triggers costs, helping to allocate costs more accurately.
Factory Overhead
Factory overhead refers to all indirect costs associated with manufacturing, excluding direct materials and direct labor expenses.
Direct Labor Hours
The total hours worked by employees directly involved in the production process.
Predetermined Factory Overhead Rate
A rate calculated before a period begins, used to allocate estimated overhead costs to individual units of production based on a specific activity base.
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