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Figure 12-1 The Neuron
Use Figure 12-1 to answer the following questions:
-Identify the structure labeled "5."
Variable Costing
An accounting method that includes only variable production costs (materials, labor, and variable overhead) in product cost calculations, excluding fixed overhead.
Absorption Costing
A costing method that includes all manufacturing costs - direct materials, direct labor, and both variable and fixed manufacturing overhead - in the cost of a product.
Income Statement
A financial statement showing the revenue, expenses, and profit or loss of a company over a specific period.
Equivalent Units
A measure used in cost accounting to express the amount of work done on partially finished goods in terms of fully completed units.
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