外国会计选读chapter10.pptVIP

Nature of Fixed Assets Classifying Costs Acquisition cost include invoice amounts (less any discount)、sales taxes、transportation charges、installation costs、costs of trial runs to adjust equipment and costs to refurnish equipment purchased in a used condition. Costs associated with new construction, such as labor and materials, should be reflected in a “Construction in progress” account. Sales taxes Freight Installation Repairs (purchase of used equipment) Reconditioning (purchase of used equipment) Nature of Depreciation Depreciation Expense Factors Guideline for useful lives Acquired during the first half of a month, it is treated as if the event occurred on the first day of that month Acquired during the second half of a month, it is treated as if the event occurred on the first day of next month Straight-line Method 直线法 Units-of-Production Method 产量单位法 Declining Balance Method 余额递减法 Sum-of-the-years-digits Method 年数总和法 1 $24,000 $24,000 $4,400 $19,600 2 24,000 $ 4,400 19,600 4,400 15,200 3 24,000 8,800 15,200 4,400 10,800 4 24,000 13,200 10,800 4,400 6,400 5 24,000 17,600 6,400 4,400 2,000 Accounting for Fixed Asset Disposals固定资产处置 When fixed assets lose their usefulness they may be disposed of in one of the following ways: 1. discarded, 2. sold, or 3. traded (exchanged) for similar assets. Required entries will vary with type of disposition and circumstances, but the following entries will always be necessary: An asset account must be credited to remove the asset from the ledger, and the related Accumulated Depreciation account must be debited to remove it’s balance from the ledger. Gain or loss will be reported in the income statement as Other Income or Other Loss. Dec. 31 Amortization Expense 20,000 Patents 20,000 Discovery Mining Co.Partial Balance SheetDecember 31, 2006 Accum. Book Property, plant, and equipment: Cost Depr. Value Book Value Accum. Beginning