Direct materials are the raw materials that are directly used in the production of a product. These materials can be easily traced to the finished goods, such as the wood used to make furniture or the fabric used to create clothing. They are essential for manufacturing and are a key component of the overall cost of production. In accounting, direct materials are categorized as a part of the cost of goods sold (COGS). Businesses track these materials to manage expenses and ensure efficient production processes. Proper management of direct materials helps companies maintain profitability and meet customer demand effectively.