ECONOMICS

Detailed explanation-1: -In a shoe manufacturing company, leather and cotton are also counted as direct materials.

Detailed explanation-2: -Floating capital refers to the raw material part of the capital also known as working capital which can be used in many ways in the factory. Therefore, leather in a shoe factory is a floating capital.

Detailed explanation-3: -Direct material is the physical items built into a product. For example, the direct materials for a baker include flour, eggs, yeast, sugar, oil, and water. The direct materials concept is used in cost accounting, where this cost is separately classified in several types of financial analysis.

Detailed explanation-4: -Examples. Examples of direct materials include leather for a shoe company, wood for a furniture company, fabric for clothes making company etc. Examples of indirect materials include maintenance and housekeeping supplies, machine oils, safety equipment, stationery expenses etc.

Detailed explanation-5: -Main leather terms for shoes It is common for uppers to be made from cowhide, calfskin, goatskin, sheepskin and even horsehide at a premium price. Skins of exotic animals are also used to make shoe uppers, including Crocodile leather, snake leather and many other exotic leathers.