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Introduction
Products are goods produced by converting raw materials through the use of labour and indirect manufacturing resources http://www.camisetaargentinafutbol.com/camiseta-sergio-romero-baratas.html , such as manufacturing plant, land, and machinery. Televisions, hamburgers, automobiles, computers, clothes and furniture are examples of products. Cost is divided into direct and indirect cost in terms of degree of traceability to the product. Product costs are those costs http://www.camisetaargentinafutbol.com/camiseta-blank-baratas.html , both direct and indirect, of producing a product in a manufacturing firm or of acquiring a product in a merchandising firm and preparing it for sale.

Direct Costs
Costs which are easily traceable or identifiable with a product are called direct costs. If output units are the objects of costing, then direct costs represent costs and resources that can be traced to or identified with the finished product. Direct materials, direct labour and direct expenses are examples of direct costs.

Direct Materials and Direct Labour

Direct materials are those materials that are a part of the final product and can be directly traced to the foods being produced. The cost of those materials can be directly charges to products because physical observations can be used to measure the quantity used by each product. Materials that become part of a product usually classified as direct materials.

Direct labour is the labour that can be directly traced to the goods being produced. Physical observation can be used to measure the amount of labour used to produce a product. Those employees who convert direct materials into a product are classified as direct labor.

Indirect Costs
Indirect costs are those costs which cannot be identifies with, or traced to a single product because they are incurred for several products. The examples of indirect costs are indirect materials, salary of factory supervisors, rent http://www.camisetaargentinafutbol.com/camiseta-personalizadas-baratas.html , rates and depreciation. Indirect costs, often referred to as overheads, have to be apportioned to different products.

Indirect Materials and Indirect Labour

Indirect materials are the materials which do not form a part of the product but, help in the production of the product. The expenses incurred on such materials is known as indirect material cost for eg: lubricating oil, nails, screws, cotton waste http://www.camisetaargentinafutbol.com/ , etc.

Indirect labour is the cost of labour not directly involved in the production of the product for eg. Supervisor, watchman, repairs and maintenance workers, etc. The cost of labour in such cases cannot be directly identified with the product, job or process of production.

Conclusion
Costs also may be direct or indirect with respect to particular company segments or divisions. That is some cost which are indirect for a product, may be traced to a segment or department and thus, will be direct costs for that department. A segment may mean any one of the number of things http://www.camisetaargentinafutbol.com/camiseta-cristian-pavon-baratas.html , namely department, division, specific activity, sales territory and the like.
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