Fred, Wilma, and Barney are equal partners in a natural resource partnership. The partnership holds producing oil and gas properties, along with substantial producing timberland. Their partnership, Kutnpro Duce, is determining how to report their activities for tax purposes. Which of the following is a correct statement concerning depletion expense on their producing properties?

a) Depletion on the partnership's oil, gas, and timber properties should be reported as a deduction on Form 1065, U.S. Return of Partnership Income.

b) Depletion on the partnership's oil, gas and timber properties should only be reported as a pass-through item on each partner's Schedule K-1.

c) Timber depletion should be reported as a deduction by the partnership on Form 1065, while oil and gas depletion should only be reported as a pass-through item on each partner's Schedule K-1.

d) Oil and gas depletion should be reported as a deduction by the partnership on Form 1065, while timber depletion should only be reported as a pass-through item on each partner's Schedule K-1.