Fixed Asset

Increases or decreases in the value of assets owned by the corporation, including tangible assets such as land and buildings, and intangible assets such as goodwill.

Fixed assets are assets that will be held or used over a period longer than one year. Companies typically have land, equipment, and buildings as their fixed assets. The account is usually called property, plant, and equipment or PP&E.

Assets are things that a company owns that have value. This typically means they can either be sold or used by the company to make products or provide services that can be sold. Assets include physical property, such as plants, trucks, equipment and inventory. It also includes things that can’t be touched but nevertheless exist and have value, such as

Assets are to be recorded and valued based of the type of asset there are.

If an item meets one of those requirements, the company can deduct the cost of the item during the year in which the item is first used or consumed. If not, the company generally needs to “capitalize the amounts paid to acquire or produce tangible property” under Reg. §1.263(a)-1. However, there is also an exception called de minimis safe harbor election under the Reg. §1.263(a)-1(f). In order to utilize this election, a company must have written accounting procedures in place before January 1, 2014, The written accounting procedures must clarify that for non-tax purposes the company expenses items with the amount paid to a property costing less than a specific amount of money or a property with economic useful life of 12 months or less. The election provides business with the option to expense/deduct annually up to $5,000 per item/invoice if the company has an applicable financial statement (AFS), or up to $500 per item/invoice if the company does not have an AFS. An AFS is defined in

The difference between Current and Fixed assets is that fixed assets are things the business intend to keep, they will not be selling them in order to turn them into money. Fixed assets are non-moveable in the business and lose value over time. Current assets are things the business owns and intend on selling (e.g. stock) or turning into cash for the business (or already have e.g. in the bank). Current assets are designed to be cash eventually and are much more liquid than fixed assets.

Fixed assets might have been acquired at a time when prices were high and now the prices have corrected substantially. But in the balance sheet the assets are yet shown at their book value less depreciation written off.

“Assets are economic resources that have expected future benefits to the business” (Baker, 2014). There are short and long term assets. Short-term assets are assets that will be utilized within a year. Examples of short-term assets are cash, inventory, and accounts receivable. Long-term assets are assets that will continue to beneficial longer than a year. Examples of long-term assets are buildings, land, and equipment.

The current assets are those which are readily convertible into cash and cash equivalents due to their highly liquid nature and also form part of working capital of the company’s operations. However, the long term assets in contrast are not liquid because since they have a useful life of more than a year and hence their full value cannot be easily realized within

10. Fixed asset turnover = Total Revenues in Statement of Operations / Net Property and

In general, intangible assets are assets that are not physical in nature. Corporate intellectual property (items such as patents, trademarks, copyrights, business methodologies), goodwill and brand recognition are all common intangible assets in today's marketplace.

There are two types of intangible assets, those that have been purchased by organizations and secondly

One of these is with regards to goodwill and intangible assets with identifiable useful lives.

According to this concept the asset is recorded in the books of accounts at the price paid for it and not at its market value. For example: if a business entity purchases a building valued at $15 million from a friend for $12 million, this asset would be recorded at $12 million and not at $ 15 million, because for the business entity the cost was $12 million and not $15 million.

Assets can be hard goods such as computers and equipment, but can also be information and intellectual property.