How Does the Recognition of Depletion Expense Affect the Elements

question 23

Multiple Choice

How does the recognition of depletion expense affect the elements of the financial statements?

• A)Decreases assets and stockholders' equity and decreases cash flow from investing expenses under the direct approach.
• B)Decreases cash flow from operating activities,and does not affect the amount of total assets.
• C)Increases assets,equity,and cash flow from operating activities.
• D)Decreases assets and equity,and does not affect cash flow.