In Calculating Depletion of Natural Resources Each Period

question 49

Multiple Choice

In calculating depletion of natural resources each period

• A)cost depletion must be used.
• B)percentage depletion must be used.
• C)the greater of cost depletion or percentage depletion must be used.
• D)the smaller of cost depletion or percentage depletion must be used.

Understand cost calculations under absorption costing.

Understand cost calculations under variable costing.

Differentiate between absorption and variable costing.

Calculate net income under variable and absorption costing.

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Definitions:

Leap Years

Years that contain 366 days instead of the usual 365, with an extra day added to February, occurring every four years to maintain the calendar year's alignment with the Earth's revolutions around the Sun.

Interest Computation

The process of calculating the amount of interest due on a loan or investment based on the principal amount, rate, and time.

Maturity Date

The specific date on which the principal amount of a loan, bond, or other financial instrument is due to be paid back in full.

Leap Years

Years that are divisible by 4 (and if it's a century year, it must be divisible by 400), adding an extra day, February 29, to the calendar to keep it synchronized with Earth's orbit around the Sun.