| A | B |
|---|
| Direct cost | A cost that is a major part of the inventory cost |
| Indirect cost | A cost that is a minor part of the inventory cost. usually considerd overhead cost. |
| Overhead cost | All costs not part of inventory costs. Production support costs. |
| Material price variance | The difference between the standard cost and the actual cost of materials |
| Material quantity variance | The difference between the standard quanity of material to bu used and the actual quanity of material used in dollars. |
| ROI | Return on Investment |
| Residual Income | Income left over after deducting an interest charge for capital invested from net income of the division. |
| Standard cost | Company standards set for production prices and usage. |
| Goal congruence | All on the same page. |
