The costs of indirect materials cannot easily be traced to the manufactured product and is therefore a component of manufacturing overhead.

Question

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Indirect materials are materials that are used in the manufacturing process but their cost cannot be easily traced to a specific product unit. Examples include lubricants, solvents, and cleaning supplies. Since these costs cannot be directly assigned to a particular product, they are considered part of manufacturing overhead and are allocated to all products based on a predetermined overhead rate.

The Costs of Indirect Materials Cannot Easily Be Traced to the Manufactured