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(see Figure 9.6)
-The structure labeled "1" in this illustration is the
Cost of Goods Sold
The direct costs attributable to the production of the goods sold by a company, including materials and labor costs.
Predetermined Rate
An estimated rate used to apply manufacturing overhead costs to products, calculated before the actual overhead costs are known.
Direct Labour Cost
The expense associated with workers who are directly involved in the production of goods or services, distinguished from indirect labor costs like supervision and maintenance.
Predetermined Overhead Rate
An estimated charging rate used to apply manufacturing overhead costs to produced units, based on a selected activity base.
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