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Options for entry into foreign markets range from exporting to global strategies. Explain how commitment, complexity, risk, and control changes as firms move across the spectrum of involvement in international marketing. What factors should firms consider when choosing entry modes?
Predetermined Overhead Rate
A rate calculated at the beginning of a period, based on the estimated overhead costs and estimated level of activity, used to apply overhead costs to products.
Activity-Based Costing
A costing method that assigns overhead and indirect costs to related products and services based on the actual consumption of resources.
Traditional System
A cost accounting system that allocates overhead based on a single or few measures of activity, such as direct labor hours or machine hours.
Predetermined Overhead Rate
A rate used to apply manufacturing overhead to products, calculated before the period begins based on estimated costs and activity levels.
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