The accumulated depletion of a natural resource is reported on the
A) balance sheet as depreciation from the cost of the resource
B) income statement as an increase in revenue
C) balance sheet as a deduction from the cost of the resource
D) income statement as a deduction from revenues

Question

Quizplus · Accepted Answer

Depletion is the gradual and systematic use of natural resources. The accumulated depletion of a natural resource is reported on the balance sheet as a deduction from the cost of the resource. This deduction reflects the reduction in the value of the asset over time as a result of its use. This is in accordance with the matching principle of accounting, which requires that expenses be matched with the revenues they help to generate.

The Accumulated Depletion of a Natural Resource Is Reported on the