what is direct material cost? what is direct labour cost? what is direct expenses?

Question

I want to know what direct and indirect material cost, labour cost and expenses are. Only definitions.

Answer 1

Direct costs relate directly to the production of the item. Eg. the man building the item. Indirect costs relate indirectly. Eg. the man driving the forklift to deliver the raw materials for production. Generally, indirect costs need to be allocated to the items produced.

Answer 2

The term direct in this context means those items which can be specifically attributed to a particular job or task i.e if a builder is biding a house the cost of the materials in the house, the wages paid to the guys boding the building and the cost of transporting them to the site are all direct. However the portion of the costs of the accounts department attributed to the job. the cost of any surplus materials put into store are all indirect