Raw Materials Stock

1. Raw material stock

The term raw material does not necessarily mean material in its basic form, but can include previously manufactured components.

Example: Direct and raw material stock

When manufacturing a bedroom suite, the headboards could have been purchased ready-made.  These ready-made headboards are then considered raw materials for the manufacturing of bedroom suites. 

By far most raw material stock can be classified as direct material stock

When manufacturing a single product, more than one type of raw material can be used.

Example: Direct and raw material

The steel, leather and sponge used in manufacturing an office chair are the raw materials.  In this case it is the direct material.

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