Which of the following terms is commonly used to describe the concept whereby the cost of manufactured products is composed of direct materials cost, direct labor cost, and variable factory overhead cost?

A) absorption costing
B) differential costing
C) standard costing
D) variable costing

Direct Labor

The labor costs directly associated with the manufacture of products or the provision of services, including wages of workers who can be directly linked to specific goods or services.

Variable Factory Overhead

Costs that fluctuate with the level of production, such as utilities and materials used in the manufacturing process.