Cost of Materials

{
  "id": "MLC-T-ECS-000419",
  "term": "Cost of Materials",
  "field": "Economic statistics",
  "definition": "This term refers to direct charges actually paid or payable for items consumed or put into production during the year, including freight charges and other direct charges incurred by the establishment in acquiring these materials. It includes the cost of materials or fuel consumed, whether purchased by the individual establishment from other companies, transferred to it from other establishments of the same company, or withdrawn from inventory during the year. Included in total cost of materials are:\n\n• Cost of parts, components, containers, etc. Includes all raw materials, semifinished goods, parts, containers, scrap, and supplies put into production or used as operating supplies and for repair and maintenance during the year.\n\n• Cost of products bought and sold in the same condition.\n\n• Cost of fuels consumed for heat and power. Includes the cost of materials or fuel consumed, whether purchased by the individual establishment from other companies, transferred to it from other establishments of the same company, or withdrawn from inventory during the year.\n\n• Cost of purchased electricity. The cost of purchased electric energy represents the amount actually used during the year for heat and power. In addition, information was collected on the quantity of electric energy generated by the establishment and the quantity of electric energy sold or transferred to other plants of the same company.\n\n• Cost of contract work. This term applies to work done by others on materials furnished by the manufacturing establishment. The actual cost of the material is to be reported on the cost of materials, parts, and containers line of this item. The term \"Contract Work\" refers to the fee a company pays to another company to perform a service.",
  "references": [
    "U.S. Census Bureau Glossary"
  ],
  "url": "https://mlchart.com/terminology/economic-statistics/cost-of-materials/"
}