Depletion is the process of allocating the cost of natural resources to the period when it is consumed. Option A refers to a different accounting term known as amortization, Option B is incorrect as depletion does not result in an increase in the value of a natural resource, Option C refers to another accounting term known as depreciation, and Option E refers to the process of allocating the cost of intangibles to periods when they are used.

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Depletion Is

Question 123

Multiple Choice

Depletion is:

A) Also called amortization.
B) An increase in the value of a natural resource when incurred.
C) Calculated using the double-declining balance method.
D) The process of allocating the cost of natural resources to the period when it is consumed.
E) The process of allocating the cost of intangibles to periods when they are used.

Correct Answer: