"Depreciation is a period expense for financial statement purposes." Do you agree? Explain.

A.

Depreciation related to production activities is a product cost, not a period cost. Hence, it will become an expense as a part of manufacturing cost of goods sold. Thus, depreciation is not always an immediate expense. Depreciation not related to production activities is a period cost.

B.

Depreciation related to merchandising activities is a product cost, not a period cost. Therefore, it is always an immediate expense and never becomes a part of inventory. Depreciation not related to merchandising activities is a period cost.

C.

Depreciation related to merchandising activities is a period cost, not a product cost. Therefore, it is always a part of inventory and never an immediate expense. Depreciation not related to merchandising activities is a product cost.

D.

Depreciation related to production activities is a period cost, not a product cost. Hence, it will become an expense as a part of manufacturing cost of goods sold. Thus, depreciation is not always an immediate expense. Depreciation not related to production activities is a product cost.