The Distinction Between Direct and Indirect Material In Cost Accounting.
Direct Material:
- Direct materials are those materials which are easily identifiable with the cost of production.
- Direct materials can be conveniently measured with the cost of product.
- Direct materials are part of the finished products.
- Direct materials are part of the prime cost.
image source: 2012books.lardbucket.org/books/accounting-for-managers/section_06/e865ff95c097c5119d4e260b57363136.jpg
Indirect Material:
- Indirect materials are those materials which can not be easily identified with the cost of production.
- Indirect materials can not be easily measured in cost of production.
- Indirect materials are part of the overheads.
- Indirect materials are part of the factory cost.