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After the dentist spent almost $600 to purchase the Apollo Whitening System to use with patients who want their teeth bleached, he learned that a more efficient system with fewer potential side effects was available for $400. From this information you know the dentist most likely experienced:
Direct Labor
Direct labor refers to the wages or salaries paid to employees who are directly involved in the manufacturing or production of goods.
Overhead
The indirect costs or expenses incurred by a business that are not directly tied to specific product production or service.
Conversion Cost
The sum of direct labor costs and manufacturing overhead costs, representing the expenses necessary to convert raw materials into finished goods.
Equivalent Unit
A concept used in cost accounting to represent a partially finished unit in terms of a full finished unit.
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