direct materials


direct materials
Materials that are directly incorporated in the final product or cost unit of an organization. For example, in the production of furniture, direct materials would include wood, glue, and paint. Compare indirect materials

Big dictionary of business and management. 2014.

Look at other dictionaries:

  • direct materials — UK US noun [plural] PRODUCTION ► things that are used in making a product that become a part of that product when it is finished: »Direct materials include the raw materials and components used in manufacturing. »The first step in determining a… …   Financial and business terms

  • direct materials — Materials that are directly incorporated in the final product or cost unit of an organization. For example, in the production of furniture, direct materials would include wood, glue, and paint. Compare: indirect materials …   Accounting dictionary

  • Direct materials cost — is the cost of direct materials which can be easily identified with the unit of production. For example, the cost of glass is a direct materials cost in light bulb manufacturing[1]. The manufacture of products or goods required material as the… …   Wikipedia

  • direct materials yield variance — direct materials quantity variance In standard costing systems, part of the direct materials usage variance; it is the difference between the total standard quantity of material allowed for a process in standard proportions (see standard mix) and …   Accounting dictionary

  • direct materials stocks — direct materials inventory The list of raw materials in store awaiting transfer to production, after which the materials are incorporated into work in progress …   Accounting dictionary

  • direct materials usage variance — In a standard costing system, a variance arising as part of the direct materials total cost variance. It compares the actual quantity of material used to carry out production with the standard quantity allowed, and values the difference at the… …   Accounting dictionary

  • direct materials cost — Expenditure on direct materials It is one of the cost classifications that make up the direct cost of a cost unit and is ascertained by collecting together the quantities of each material used on each product by means of materials requisitions… …   Big dictionary of business and management

  • direct materials price variance — In a standard costing system, a variance arising as part of the direct materials total cost variance. There are two alternative points at which the materials price variance may be established: when the material is purchased or when it is issued… …   Accounting dictionary

  • direct materials cost — Expenditure on direct materials. It is one of the cost classifications that make up the prime cost of a cost unit and is ascertained by collecting together the quantities of each material used on each product by means of materials requisitions… …   Accounting dictionary

  • direct materials total cost variance — A combination of the direct materials price variance and the direct materials usage variance; it compares the actual cost and the standard cost of the direct material consumed in carrying out the actual production. The formula for this variance… …   Accounting dictionary