question archive Depletion expense A) is usually part of cost of goods sold
Depletion expense A) is usually part of cost of goods sold
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Depletion expense
A) is usually part of cost of goods sold.
B) includes tangible equipment costs in the depletion base.
C) excludes intangible development costs from the depletion base.
D) excludes restoration costs from the depletion base.
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Ans
A)is usually a part of cost of goods sold
Depletion is the cost incurred for the extraction of natural resources like coal, oil,natural gas etc… The Depletion expense of are operating expenses like that of depreciation to fixed asset and hence it should be recorded in income statement. Being it as an operating expense, it is a part of cost of goods sold.
