For charging depreciation, on which of the following assets, the depletion method is adopted?

Plant & machinery

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Land & Building

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Goodwill

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Wasting assets like mines and quarries

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Solution

The correct option is D Wasting assets like mines and quarries
Depletion method. Depletion is a periodic charge to expense for the use of natural resources. Thus, it is used in situations where a company has recorded an asset for such items as oil reserves, coal deposits, or gravel pits.

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Similar questions

Q. Which of the following method is applicable in case of wasting assets, i.e., mines, quarries, oil well etc.?

Q. Match List I with List II and select the correct answer using the codes given below the lists.

	List I		List II
A.	Leasehold property	1.	Depreciation Fund Method
B.	Mines, quarries etc.	2.	Annuity Method
C.	The interest lost on the acquisition of Method an asset	3.	Fixed Instalment Method
D.	To provide for replacement of assets at the end of its useful life	4.	Depletion Method

Amortization of intangible assets and depletion of natural resources is conceptually similar to depreciation of constructed assets. Is the statement correct?

In which of the following methods of charging depreciation, it is charged on Orginal cost of the asset?

In which of the following methods of charging depreciation, it is charged on Written down value of the asset?

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For charging depreciation, on which of the following assets, the depletion method is adopted?

The correct option is D Wasting assets like mines and quarriesDepletion method. Depletion is a periodic charge to expense for the use of natural resources. Thus, it is used in situations where a company has recorded an asset for such items as oil reserves, coal deposits, or gravel pits.

The correct option is D Wasting assets like mines and quarries
Depletion method. Depletion is a periodic charge to expense for the use of natural resources. Thus, it is used in situations where a company has recorded an asset for such items as oil reserves, coal deposits, or gravel pits.