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Predetermined Overhead Rate
An estimated rate used to allocate manufacturing overhead costs to individual units of production based on a specific activity like labor hours or machine hours.
Direct Labour Hours
The total hours of labor directly involved in the production process, used as a base for allocating overhead costs.
Direct Materials Purchases
Direct materials purchases encompass the cost of acquiring raw materials that are directly involved in the production of goods.
Cost of Goods Manufactured
The total production cost of goods that are completed and ready for sale, including materials, labor, and overhead.
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