On the balance sheet for a manufacturing business, the cost of direct materials, direct labor, and factory overhead are categorized as either materials inventory, work in process inventory, or finished goods inventory.

This is true as the three categories of costs (direct materials, direct labor, and factory overhead) are included in the inventory accounts on the balance sheet for a manufacturing business. Direct materials are included in the materials inventory, direct labor is included in the work in process inventory, and factory overhead is included in both the materials and work in process inventory, as well as the finished goods inventory.