How do the terms depreciation, depletion, and amortization differ?

A

All three terms, including depreciation, depletion, and amortization, are used to refer to the process of allocation of costs of assets over their useful economic life. However, the types of assets that they are used to refer to are different. The term depreciation is used to refer to the process for tangible assets, including building and machinery; depletion is used for minerals and other natural resources, and amortization is used for intangible assets such as patents and copyright. However, it is to understand that different methods for different types of assets are used for allocating cost over time.

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Academic.Tips. 2021. "How do the terms depreciation, depletion, and amortization differ?" July 21, 2021. https://academic.tips/question/how-do-the-terms-depreciation-depletion-and-amortization-differ/.

1. Academic.Tips. "How do the terms depreciation, depletion, and amortization differ?" July 21, 2021. https://academic.tips/question/how-do-the-terms-depreciation-depletion-and-amortization-differ/.


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Academic.Tips. "How do the terms depreciation, depletion, and amortization differ?" July 21, 2021. https://academic.tips/question/how-do-the-terms-depreciation-depletion-and-amortization-differ/.

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"How do the terms depreciation, depletion, and amortization differ?" Academic.Tips, 21 July 2021, academic.tips/question/how-do-the-terms-depreciation-depletion-and-amortization-differ/.

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