Both accumulated amortization and accumulated depletion operate in the same way as

depreciation; they are all considered contra-asset accounts in the accounting system. The

naming convention differs based on the asset's type; the specifics are not important.

Depreciation is the term used to describe the reduction in value of tangible assets such as

real estate, plant, and equipment.

In the case of intangible assets like as patents, licenses, or trademarks, it is referred to as

amortization, whereas for natural resources-related assets such as mines or oil platforms,

it is referred to as depletion. When an expense such as amortization or depletion is

recorded for the year, the corresponding cumulative contra-asset accounts are credited in

order to account for the expense incurred that year.