Final answer:
In a company's financial statements, the original cost of natural resources is classified as a long-term asset, the amount depleted as inventory, and the amount matched with related revenues as cost of goods sold.
Step-by-step explanation:
The subject of this question is the financial classification of different stages of a company's natural resources on various financial statements. When a company purchases a natural resource, it is classified as a long-term asset on the balance sheet. This is because the resource will provide economic benefit to the company for many years. As the company extracts and consumes the resource over time, the depletion amount is recorded as inventory on the balance sheet because it represents the current assets that will be sold within a year. Finally, when the depleted resource is actually sold, the expense related to using up the resource is then classified as cost of goods sold (COGS) on the income statement, thereby matching the cost of the resource with the revenues it generates.