Industrial Raw Materials Key Terms
Gain knowledge about the key terms associated with industrial raw materialsIndustrial raw materials encompass a wide range of industrial materials and products. Many different industries require the use of industrial raw materials; if your business is one of them, it's important to learn the terms associated with industrial raw materials.
In order to make the most of industrial raw materials, make sure to learn the following terms: capital goods, cash cycle, costs of goods sold, crude oil, chemicals and biomass.
Cash cycleIt is important to be aware of the financial issues related to working with raw materials. Cash cycle, also known as cash conversion cycle, describes the time period that exists between the purchase of the raw materials and the receipt of payment for the finished product.
Cost of goods soldCost of goods sold is a term that describes the cost of purchasing raw materials combined with the costs of producing the finished product.
IRS provides a definition of cost of goods sold along with related information on its website.
Crude oilCrude oil is a major raw material and is used in the production of petrochemicals, gasoline, plastics and many other products. Crude oil is the term used to describe unprocessed petroleum that is pumped out of the ground.
ChemicalsChemicals refers to the broad category of industrial raw materials that includes chemicals and chemical compounds. Chemicals are used in the production of many products, from plastics to pharmaceuticals to food additives. Some common examples of raw chemicals include citric acid, glycerine and toluene.
BiomassBiomass is a term applied to animal waste and plant matter that can be used as fuel. Growing environmental concerns have placed greater emphasis on the importance and viability of using biomass as an industrial raw material.
Copyright © 2013 Business.com, Inc. All Rights Reserved.