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Three situational criteria identified in the Fiedler model are:
Variable Costing
An accounting method that accounts only for variable production costs (direct materials, direct labor, and variable manufacturing overhead) in product cost calculations, excluding fixed manufacturing overhead.
Unit Product Cost
The complete expense incurred to manufacture a single item, encompassing materials, workforce, and indirect costs.
Contribution Margin
The difference between sales revenue and variable costs, indicating how much revenue contributes to covering fixed costs.
Variable Costing
A bookkeeping approach that incorporates just the variable costs of production (such as direct materials, direct labor, and variable factory overheads) into the costs of products.
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