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If a mining company extracts 1,500,000 tons in a period but only sells 1,200,000 tons, total depletion on the mine is based on the 1,200,000
If a mining company extracts 1,500,000 tons in a period but only sells 1,200,000 tons,
total depletion on the mine is based on the 1,200,000 tons. | ||
depletion expense is recognized on the 1,500,000 tons extracted. | ||
depletion expense is recognized on the 1,200,000 tons extracted and sold. | ||
a separate accumulated depletion account is set up to record depletion on the 300,000 tons extracted but not sold |
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