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Actual Costs
Actual costs are the expenses that a company incurs for producing goods or services, including materials, labor, and overhead, as opposed to estimated or budgeted costs.
Standard Costs
The predetermined costs of manufacturing a product or providing a service, used as benchmarks against actual costs.
Direct Materials Quantity Variance
The difference between the actual quantity of materials used in production and the expected quantity, multiplied by the standard cost per unit of material.
Malfunctioning Equipment
Equipment that is not operating correctly or as expected, often leading to operational inefficiencies or safety concerns.
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