In the Analysis of Variances, Management Commonly Focuses on Four

question 135

Short Answer

In the analysis of variances, management commonly focuses on four categories of production costs:
________ cost, ________ cost; ________ cost; and ________ cost.

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Definitions:

Averaging Process

A method used in manufacturing or cost calculation where inputs or expenses over a period are averaged to determine a standard cost or value.

Absorption Costing

A cost accounting method that includes all manufacturing costs—direct materials, direct labor, and both fixed and variable manufacturing overhead—in the cost of a product.

Nonmanufacturing Costs

Expenses not directly related to the production of goods, such as selling, general, and administrative expenses.

Job-Order Costing

An accounting method that tracks costs individually for each job, suitable for manufacturing operations that produce goods based on specific customer orders.