Accounting · Depletion accounting
Which statement accurately describes the accounting practice of 'depletion'?
Verified Solution4 OptionsUpdated: October 2026👁️1 View
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- 1The systematic reduction of fixed assets due to physical wear and tear
- 2Charging periodic expenses against earnings based on the volume of natural resources extracted✓
- 3Adjusting the value of inventory based on fluctuations in market price
- 4Allocating the cost of an intangible asset over its useful economic life
Correct answer
Charging periodic expenses against earnings based on the volume of natural resources extracted
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