Fixed assets, Accounting Standards

Assignment Help:

Fixed Assets

These are tangible, relatively long-lived items owned through the business. The benefit of these assets is obtainable not only in the accounting period wherein the cost is incurred but over several accounting periods. Recent assets give benefits to the organization by their exchange in cash. In the case of fixed assets, value addition arises through facilitating the process of production or trade. Or we can say, benefits from fixed assets are indirect quite than direct.

All man made things have restricted life. In accounting we are concerned along with the helpful life of the assets. Practical life is the period for that a fixed asset could be economically used. It implies that the benefits from the fixed assets will flow to the organization during its useful life. Another aspect of which is that the cost incurred in the duration of purchase of the asset will be providing benefits over the practical life of the asset.

Valuation of the fixed assets is generally made on the basis of original cost. Though, since assets have restricted life the cost will be expiring along with the expiration of the life. So, valuation of the asset is reduced through an amount proportionate to the expired life of the asset. That expired cost is considered to as depreciation in accounting.

Fixed assets usually comprise assets as land, building, machinery, plant and motor vehicles. All these items, along with the exception of land such are depreciated. Land is not subject to reduction and hence demonstrated separately from other fixed assets.


Related Discussions:- Fixed assets

Data attributes for every entity, Make a new information system for this co...

Make a new information system for this company. Your solution should contain the following items: 1.  An overview of the primary features of the new system, describing why this

Government accountability office, Government Accountability Office (GAO) - ...

Government Accountability Office (GAO) - Accounting and auditing office of the United States government. An independent agency which reviews federal financial transactions and repo

Direct expenses, Direct expenses comprise all those expenses incurred in br...

Direct expenses comprise all those expenses incurred in bringing the goods to the place of business or trade or in-production process till the goods are placed in saleable places.

IMPACTS OF ACCOUNTING , WHAT ARE THE AIMS AND OBJECTIVES IN STUDYING THE IM...

WHAT ARE THE AIMS AND OBJECTIVES IN STUDYING THE IMPACTS OF ACCOUNTING STANDARDS IN THE PREPARATION OF FINANCIAL STATEMENTS

Pruthviraj, Explain in Details Return on Investment

Explain in Details Return on Investment

Accountancy–1ECO-02, The book of Deven Verma could not be tallied. The acco...

The book of Deven Verma could not be tallied. The accountant transferred the difference of Rs. 1,270 in the suspense account on the debit side. The following mistakes were found la

American accounting association, Consisting mainly of accounting educators ...

Consisting mainly of accounting educators the American Accounting Association (AAA) has sought to encourage research and study at a theoretical level into the concepts or standards

Financial statement, describe why a high stock turnover is considered to be...

describe why a high stock turnover is considered to be a good thing

What is social accounting, Question : (a) In relation to a non-profit o...

Question : (a) In relation to a non-profit organization describe social accounting and describe its main aims. (b) What are the needs an organisation wants to satisfy throug

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd