What are the difference between Direct Material and Indirect Material?

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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.

    How a Job Costing System Works

    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.

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