Accounting for Natural Resource Assets & Depletion

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question 1 of 3

How does depreciation differ from depletion of an asset?

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1. Which of the following is one of the steps to compute depletion?

2. If a company purchased 4,000 acres of land for $5,000,000 that has an estimated 250,000 tons of lumber, what is the amount of depletion expense if the company harvested 2,500 tons of lumber that year?

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About This Quiz & Worksheet

Test what you understand about accounting for natural resource assets with these study resources. Quiz questions will bring to light your grasp of certain subjects like depletion and depreciation.

Quiz & Worksheet Goals

You'll need to know about:

  • How to calculate a depletion expense
  • Credit balance and asset accounting with regard to value
  • Computing depletion with regard to land a company purchased

Skills Practiced

  • Reading comprehension - ensure that you draw the most important information from the related lesson on accounting for natural resource assets
  • Information recall - access the knowledge you've gained regarding the calculations of depletion expense
  • Defining key concepts - ensure that you can accurately define main phrases, such as depletion and depreciation

Additional Learning

Use the lesson called Accounting for Natural Resource Assets & Depletion to learn more about the following:

  • Company assets on their balance sheet
  • Salvage value
  • The calculations of profit with regard to land purchases
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