Which of following is not a similarity in the accounting treatment for depreciation and cost depletion?
A) The estimated life is based on economic or productive life.
B) Assets subject to either are reported in the same classification on the balance sheet.
C) The rates may be changed upon revision of the estimated productive life used in the original rate computations.
D) Both depreciation and depletion are based on time.

Question

Quizplus · Accepted Answer

Depreciation is primarily based on the passage of time and the use of the asset, whereas cost depletion is calculated based on the removal of natural resources from the asset, making it more directly tied to the quantity of resource extracted rather than just time.

Which of Following Is Not a Similarity in the Accounting