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For this situation, the calculation of total manufacturing cost is as follows: 1  Direct materials. 2  Add the total cost of materials purchases in the period to the cost of beginning inventory, and subtract the cost of ending inventory.3  The result is the cost of direct materials incurred during the period. 4  Direct labor. Direct materials. 2  Add the total cost of materials purchases in the period to the cost of beginning inventory, and subtract the cost of ending inventory. 3  The result is the cost of direct materials incurred during the period. 4  Direct labor.
To calculate work-in-progress inventory, add the cost of direct materials to direct labor and manufacturing overhead for the incomplete inventory.hat's in Direct Materials. Direct materials are the raw supplies and materials used to create a product. For example, the direct materials for a company that makes packaged cookies would be items like eggs, flour, sugar, oil and plastic wrap.