Wednesday, December 31, 2008

What are Indirect Materials?

Indirect materials are generally small items of material such as rivets, nails, and oil . They can be considered be an integral part of a finished product produced by the manufacturing company but their costs are difficult to trace and may be insignificant in the overall costs incurred to produce a product. Indirect materials are ordinarily classified as manufacturing overhead and can be applied to the product costs.

Links related to indirect materials and managerial accounting:

Calculate Manufacturing Overhead
Job Order Costing
Manufacturing Company Accounting

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