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In the US, the answer depends on what depreciable assets you are talking about.
Depreciation on any depreciable asset that is directlyused in the production of goods is part of Manufacturing Overhead, and therefore is a product cost, which is included in the calculation of the value of both inventory and cost of goods sold. So, depreciation on a factory building and factory equipment directly used to manufacture a product are both product costs.
Conversely, depreciation on equipment that is NOTdirectly used in production (e.g., depreciation on office computer equipment) is NOT a product cost.
What else can I help you with?
Is depreciation on a machine a period cost or product cost?
product cost
Is depreciation of delivery truck a period cost?
Yes depreciation of delivery truck is period cost because it is not product cost as it is not require to make the units of product.
Depreciation on delivery truck is product cost?
Depreciation on delivery truck is period cost as it is not necessary for the making of product.
Is depreciation on office equipment classified as a period cost or product cost?
period cost
Is depreciation of factory buildings classified as a period cost or product cost?
If factory building is used in production of units of product then it will be added to product cost as it is part of product to manufacture.
Is depreciation a product dost?
Depreciation is a period cost and not a product cost as depreciation is still charged even if there is no production or sale of goods.
Is depreciation on a machine a period cost or product cost?
product cost
Is depreciation of delivery truck a period cost?
Yes depreciation of delivery truck is period cost because it is not product cost as it is not require to make the units of product.
Depreciation on delivery truck is product cost?
Depreciation on delivery truck is period cost as it is not necessary for the making of product.
Is depreciation on office equipment classified as a period cost or product cost?
period cost
Is the depriciation cost is direct cost?
Depreciation is an indirect cost as there is no separate identification in product cost that which cost is depreciation as deprecation is a overhead cost that’s why it is indirect cost.
Is depreciation of factory buildings classified as a period cost or product cost?
If factory building is used in production of units of product then it will be added to product cost as it is part of product to manufacture.
Is depreciation of administrative equipment product cost or period cost?
Depreciation of administrative equipment is period cost because if production is done or not those assets will be depreciated hence cost will be charged as period cost.
What is the cost of depreciation of capital equipment minus GNP?
Net National product
Is depreciation is included in cost of a product?
Yes, depreciation is included in the cost of a product. It allocates the cost of tangible assets over their useful lives, reflecting the wear and tear of equipment, machinery, or buildings used in production. This allocation is part of the overall manufacturing or operating costs, impacting the pricing and profitability of the product. Including depreciation helps companies accurately assess their expenses and financial performance.
Is depreciation on the factory building a product cost?
Yes, depreciation on the factory building is considered a product cost. It is part of the manufacturing overhead, which includes all costs associated with the production process that are not directly tied to specific products. As such, depreciation is allocated to the cost of goods manufactured and ultimately included in the inventory valuation until the products are sold.
Is depreciation on factory equipment a product cost?
Yes, depreciation on factory equipment is considered a product cost. It is included in the manufacturing overhead, which is allocated to the cost of goods produced. This treatment aligns with the matching principle in accounting, where costs are matched with the revenues generated from the products. Thus, it contributes to determining the total cost of production.
