The journal entry to record depletion would include:
A) a debit to Depletion Expense and credit to Accumulated Depreciation.
B) a debit to Accumulated Depletion and a credit to Depletion Expense.
C) a debit to Depletion Expense and a credit to Accumulated Depletion.
D) none of the above.

Question

Quizplus · Accepted Answer

Depletion is the process of allocating the cost of a natural resource over its useful life.

Depletion Expense is an expense account that reflects the amount of natural resource consumed during a period, which decreases the carrying value of the asset.

Accumulated Depletion is a contra-asset account that reflects the total amount of depletion expense recorded to date, which reduces the carrying value of the natural resource asset.

Therefore, to record the depletion of a natural resource, we would debit Depletion Expense and credit Accumulated Depletion, as C suggests.

The Journal Entry to Record Depletion Would Include