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Page 1 ELEMENTS OF COST Page 2 ELEMENTS OF COST ELEMENT OF COST MATERIAL DIRECT MATERIAL INDIRECT MATERIAL LABOUR DIRECT LABOUR INDIRECT LABOUR EXPENSE DIRECT EXPENSE INDIRECT ENPENSE Page 3 ELEMENTS OF COST ELEMENT OF COST MATERIAL DIRECT MATERIAL INDIRECT MATERIAL LABOUR DIRECT LABOUR INDIRECT LABOUR EXPENSE DIRECT EXPENSE INDIRECT ENPENSE DIRECT MATERIAL DIRECT LABOUR DIRECT EXPENSE PRIME COST INDIRECT MATERIAL INDIRECT LABOUR INDIRECT EXPENSE OVERHEADS Page 4 ELEMENTS OF COST ELEMENT OF COST MATERIAL DIRECT MATERIAL INDIRECT MATERIAL LABOUR DIRECT LABOUR INDIRECT LABOUR EXPENSE DIRECT EXPENSE INDIRECT ENPENSE DIRECT MATERIAL DIRECT LABOUR DIRECT EXPENSE PRIME COST INDIRECT MATERIAL INDIRECT LABOUR INDIRECT EXPENSE OVERHEADS FACTORY OVERHEADS OFFICE AND ADMINISTATION OVERHEAD SELLING AND DISTRIBUTION OVERHEADS OVERHEADS Page 5 ELEMENTS OF COST ELEMENT OF COST MATERIAL DIRECT MATERIAL INDIRECT MATERIAL LABOUR DIRECT LABOUR INDIRECT LABOUR EXPENSE DIRECT EXPENSE INDIRECT ENPENSE DIRECT MATERIAL DIRECT LABOUR DIRECT EXPENSE PRIME COST INDIRECT MATERIAL INDIRECT LABOUR INDIRECT EXPENSE OVERHEADS FACTORY OVERHEADS OFFICE AND ADMINISTATION OVERHEAD SELLING AND DISTRIBUTION OVERHEADS OVERHEADS A. DIRECT MATERIAL- Direct material cost is “The cost of materials entering into and becoming constituent elements of a product or saleable service”. Thus, materials which can be identified with units of output or service are known as direct materials. 1.MATERIAL- The material cost is the cost of commodities supplied to an undertaking. B. INDIRECT MATERIAL- “Materials used for the product other than the direct materials are called indirect materials. In other words, materials cost which cannot be identified with a specific product, job, process is known as indirect material cost.Read More
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