Question : You are looking at the profit and loss account of the business enterprises. You find the term depletion in first case and amortization in third case. What is the type of business the two enterprises are into?

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Solution

In the first case, the enterprises must be involved in business related in extraction of natural resources like mines, quarries etc.
On the other hand in second case, the enterprise must be involved in certain specific contractor business where there is use of intangible assets like patents, copyright, trademarks etc.

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