Materials must have which two qualities in order to be classified as direct materials?
A) They must be classified as both prime costs and conversion costs.
B) They must be introduced into the process in both work in process inventories and finished goods inventories.
C) They must be an integral part of the finished product, but can be an insignificant portion of the total product cost.
D) They must be an integral part of the finished product and a significant portion of the total product cost.

Question

Quizplus · Accepted Answer

Direct materials must be an integral part of the finished product and a significant portion of the total product cost. This is because direct materials are those that can be traced to the finished product and contribute significantly to the cost of producing it.

Materials Must Have Which Two Qualities in Order to Be