The process of allocating the cost of natural resources over their useful life is known as:
A) Depreciation.
B) Depletion.
C) Amortization.
D) Consumption.

Question

Quizplus · Accepted Answer

Depreciation is the process of allocating the cost of tangible assets, such as buildings and equipment, over their useful life. Amortization is the process of allocating the cost of intangible assets, such as patents and trademarks, over their useful life. Consumption is not a recognized accounting term in this context. Therefore, the correct answer is depletion, which is the process of allocating the cost of natural resources, such as oil and gas reserves, over their useful life.

The Process of Allocating the Cost of Natural Resources Over