Term
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Definition
| Those products for which the sales of one may contribute to the sales of another. |
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Term
| Incremental ( or differential) cost |
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Definition
| The increases or decreases in total costs incurred by selecting one course of action over another. |
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Term
| Incremental (or differential) revenue |
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Definition
| the increase or decrease in total revenue earned by selecting one course of action over another. |
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Term
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Definition
| costs incurred in manufacturing process that produce several different products. Joint costs cannot be traced directly to the individual types of products manufactured and, therefore, must be allocated in a more or less arbitrary way. |
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Term
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Definition
| products that share, in part, common materials and production processes. |
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Term
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Definition
| the benefit foregone by not pursuing an alternative course of action. Opportunity costs are not recored in the accounting records but are important in making many types of business decisions. |
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Term
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Definition
| Costs that have not yet been incurred and that may vary among alternative courses of action |
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Term
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Definition
| the point at which separate and distinct joint products emerge from common materials and a shared production process |
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Term
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Definition
| a cost that has been incurred as a result of past actions. Sunk costs are irrelevant to decisions involving future actions. |
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