COST ACCOUNTING
INTRODUCTION TO COST ACCOUNTING
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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Materials and supplies that are consumed during the manufacture of a product, and which are directly identified.
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Materials and supplies that are consumed during the manufacture of a product, and which are indirectly identified
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All materials used in the factory.
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Detailed explanation-1: -What are Direct Materials? Direct materials are those materials and supplies that are consumed during the manufacture of a product, and which are directly identified with that product. Items designated as direct materials are usually listed in the bill of materials file for a product.
Detailed explanation-2: -Direct materials are components that go into a manufactured product. For example, components such as the screen, integrated circuits, camera modules and buttons are the direct materials involved in the production of a smartphone.
Detailed explanation-3: -Direct material costs are the costs of raw materials or parts that go directly into producing products. For example, if Company A is a toy manufacturer, an example of a direct material cost would be the plastic used to make the toys.
Detailed explanation-4: -Direct material refers to the raw materials that are directly used in the production process of goods and services of a company and are an essential component of the finished goods manufactured.
Detailed explanation-5: -Direct materials are the cost of raw materials that are incurred directly related to the production of the company’s finished products. These are the main components of the products.