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Predetermined Overhead Rate
A rate calculated before a period begins, used to allocate manufacturing overhead costs to units produced, based on a specific activity (e.g., machine hours or labor hours).
Manufacturing Overhead
The indirect costs related to manufacturing that are not directly tied to a specific product, such as factory rent or salary of supervisors.
Allocation Base
A measure or statistic used to distribute indirect costs to different products, services, or business units.
Labor Intensive
A process or industry that requires a large amount of labor to produce its goods or services, often resulting in higher labor costs.
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