The process of expensing the cost of a gold mine as gold is withdrawn is referred to as:
A)amortization.
B)depletion.
C)depreciation.
D)decomposition.

Question

Quizplus · Accepted Answer

Depletion is the process of expensing the cost of a natural resource, such as a gold mine, as the resource is removed and sold. This is different from depreciation, which is the expensing of the cost of a tangible asset over its useful life, and amortization, which is the expensing of the cost of an intangible asset over its useful life. Decomposition is not a relevant term in accounting.

The Process of Expensing the Cost of a Gold Mine