It is currently 23 Nov 2017, 02:56

Close

GMAT Club Daily Prep

Thank you for using the timer - this advanced tool can estimate your performance and suggest more practice questions. We have subscribed you to Daily Prep Questions via email.

Customized
for You

we will pick new questions that match your level based on your Timer History

Track
Your Progress

every week, we’ll send you an estimated GMAT score based on your performance

Practice
Pays

we will pick new questions that match your level based on your Timer History

Not interested in getting valuable practice questions and articles delivered to your email? No problem, unsubscribe here.

Close

Request Expert Reply

Confirm Cancel

Events & Promotions

Events & Promotions in June
Open Detailed Calendar

Depletion is the process of allocating the cost of an

  new topic post reply Question banks Downloads My Bookmarks Reviews Important topics  
Author Message
SVP
SVP
User avatar
Joined: 03 Feb 2003
Posts: 1603

Kudos [?]: 308 [0], given: 0

Depletion is the process of allocating the cost of an [#permalink]

Show Tags

New post 02 Jul 2004, 11:14
00:00
A
B
C
D
E

Difficulty:

(N/A)

Question Stats:

100% (00:29) correct 0% (00:00) wrong based on 2 sessions

HideShow timer Statistics

Depletion is the process of allocating the cost of an investment in natural resources through systematic charges to income as the supply of the physical asset reduces the course of operations.

(A) systematic charges to income as the supply of the physical asset reduces the course
(B) systematic charges to income whereas the supply of the physical asset is reduced in the course
(C) systematic charges for income as the supply of the physical asset is reduced in the course
(D) systematic charges to income as the supply of the physical asset is reduced in the course
(E) systematic charges to income whereas the supply of the physical asset reduces the course

(c) stolyar

Kudos [?]: 308 [0], given: 0

CEO
CEO
avatar
Joined: 15 Aug 2003
Posts: 3452

Kudos [?]: 926 [0], given: 781

 [#permalink]

Show Tags

New post 02 Jul 2004, 12:01
whereas is not correct here.. whereas is usually followed by an alternative or an opposing view point.

C might be incorrect. .. charge to "credit card" , charge to "debit card, charge to "income" ( wish i could explain better :oops: )

IMO, D is best.

Stolyar, this sentence is very close to the definition of depreciation.

Praet

Kudos [?]: 926 [0], given: 781

Manager
Manager
User avatar
Joined: 10 Jun 2004
Posts: 81

Kudos [?]: 5 [0], given: 0

 [#permalink]

Show Tags

New post 02 Jul 2004, 12:04
I choose D.

the sentence will be:

Depletion is the process of allocating the cost of an investment in natural resources through systematic charges to income (becuse) as the supply of the physical asset is reduced in the course of operations.
_________________

-Genius is one percent inspiration, and ninety-nine percent perspiration.

Kudos [?]: 5 [0], given: 0

Intern
Intern
avatar
Joined: 31 Mar 2004
Posts: 8

Kudos [?]: [0], given: 0

Location: Buffalo
Furthermore [#permalink]

Show Tags

New post 02 Jul 2004, 12:49
First of all, regarding to this question,
1. Charge(noun or verb) can be used with prepostion with, for, and to. In my opinion, "charge to+ somebody or account such as, checking account" are used for express meaning that some duty is imposed to some body, whereas "charge for+something" means expense or pay for acquring someting. Therefore, in this question, "charge for" might be correct, because "industry charge for earning income."
2. I think that in this question, "as" does not mean because, but means "during the course of operation, more reduced"
Hence, I think "c" would be correct.

Second, I am an international, therefore, it is not easy to distinguish correct pronoun. I might have seen the question that require me to distinguish "through" from "by" or "by means of".
Who does explain about the difference?

Thanks

Kudos [?]: [0], given: 0

Director
Director
User avatar
Joined: 01 Feb 2003
Posts: 838

Kudos [?]: 130 [0], given: 0

Location: Hyderabad
 [#permalink]

Show Tags

New post 02 Jul 2004, 13:08
my FA is A

There does not seem (to me!) to be any mistake in the given sentence

Kudos [?]: 130 [0], given: 0

GMAT Club Legend
GMAT Club Legend
avatar
Joined: 15 Dec 2003
Posts: 4284

Kudos [?]: 537 [0], given: 0

 [#permalink]

Show Tags

New post 02 Jul 2004, 13:08
D it is
"charge to" means "charged against income"
I believe what Stolyar meant by (c) is copyright which can be typed as
CTRL+ALT+C = ©
Hmm, seems like it works only in word documents.
Yes Praet, depletion is the equivalent of depreciation but it applies mainly to natural resources which can be depleted (lumber, natural gas, oil) whereas depreciation applies mainly to financial assets
_________________

Best Regards,

Paul

Kudos [?]: 537 [0], given: 0

Director
Director
User avatar
Joined: 13 Nov 2003
Posts: 957

Kudos [?]: 178 [0], given: 0

Location: Florida
Re: SC: depletion [#permalink]

Show Tags

New post 02 Jul 2004, 13:29
D for me.
systematic charges to income --> attributed to or put on an account of.
Depletion links to reduction in supply of assets in the course.

Kudos [?]: 178 [0], given: 0

SVP
SVP
User avatar
Joined: 03 Feb 2003
Posts: 1603

Kudos [?]: 308 [0], given: 0

 [#permalink]

Show Tags

New post 02 Jul 2004, 21:02
Paul wrote:
D it is
"charge to" means "charged against income"
I believe what Stolyar meant by (c) is copyright which can be typed as
CTRL+ALT+C = ©
Hmm, seems like it works only in word documents.
Yes Praet, depletion is the equivalent of depreciation but it applies mainly to natural resources which can be depleted (lumber, natural gas, oil) whereas depreciation applies mainly to financial assets


Yes, it is D. I took it from my financial accounting lessons, which I attended as a pre-MBA practice. BTW, there is yet another form of allocating costs against income—amortization. This term is applied when we deal with intangible assets, such as goodwill, patents, or copyrights.

For those who are interested, I can give a small example of amortization: On 1/1/2004 company buys a certain patent for $60 000. Its useful life is 10 years; the annual amortization is therefore $6000. The entries in 2004 will be:

1/1/2004

Patent 60 000
Cash 60 000
To record costs of acquiring patent

12/31/2004

Patent Expense (Amortization) 6000
Patent 6000
To record patent amortization

Kudos [?]: 308 [0], given: 0

  [#permalink] 02 Jul 2004, 21:02
Display posts from previous: Sort by

Depletion is the process of allocating the cost of an

  new topic post reply Question banks Downloads My Bookmarks Reviews Important topics  

Moderators: GMATNinjaTwo, GMATNinja



GMAT Club MBA Forum Home| About| Terms and Conditions| GMAT Club Rules| Contact| Sitemap

Powered by phpBB © phpBB Group | Emoji artwork provided by EmojiOne

Kindly note that the GMAT® test is a registered trademark of the Graduate Management Admission Council®, and this site has neither been reviewed nor endorsed by GMAC®.