Final answer:
The correct answer is B. Depletion expense is usually part of the cost of goods sold as it represents the cost of natural resources consumed. The depletion base includes both tangible equipment costs and intangible development costs.
Step-by-step explanation:
The calculation of depletion expense pertains to the allocation of the cost of natural resources over the period they are consumed. It is involved in industries like mining, timber, petroleum, and others where resource extraction is essential. Specifically addressing the question 'Which of the following is true of depletion expense?', the correct statement is B. It is usually part of cost of goods sold. This is because depletion expense represents the exhaustion of natural resource reserves and is directly tied to the inventory a company extracts and sells. Depletion expense should include both tangible costs, like equipment used for resource extraction, and intangible costs, such as exploration and development costs.
Contrary to options A and C, tangible equipment costs and intangible development costs should not be excluded from the depletion base. They are integral to the discovery, extraction, and marketing of the natural resources. Regarding option D, restoration costs may or may not be included in the depletion base depending on the accounting practices and the regulatory requirements of the respective jurisdiction.