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A company manufactures golf balls. Resin for golf balls is shown as direct material. Why so? Shouldn’t it be indirect material?
Or is it that resin is the main material for golf balls?
Resin is not the main material, but that is irrelevant.
What makes it a direct cost is that they can measure the amount of resin in each ball. The total direct material cost per ball will be the total of all the materials used within the manufacture of each ball.
Have you watched my free lectures on cost classification? The lectures are a complete free course for Paper MA and cover everything needed to be able to pass the exam well.
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