会计英语第5章.pptxVIP

会计英语;5.1 Fixed Assets 5.1.1 Definition and Characteristics of Fixed Assets Long-lived assets acquired for use in the operation of the business but not intended for resale to customers. The common examples of fixed assets include houses, buildings, machinery, vehicle and other equipment and tools related to production and operation. .;1. Fixed Assets Belong to Tangible Assets Fixed assets are existing entities which can be seen and felt. They are different from intangible assets, accounts receivable, and other receivables. For an intangible asset, although it can be used for a long time, and even its useful life exceeds the useful life of fixed assets, it cannot be used as fixed assets because of its invisibility. ;In practice, most of cash are deposited in bank and a company needs to reconcile with bank by preparing bank reconciliations. Usually, there are two sections in the bank reconciliation. The first section begins with cash balance in the bank statement and ends with the adjusted balance. The second section starts with the cash balance in the company’s (depositor’s) journal of cash and ends with the adjusted balance. These two adjusted balances must be equal. ;2. Fixed Asset Can Be Used for a Long Time Fixed asset is a long-term durable asset, whose useful life is more than one accounting period. Generally, the useful life of a fixed asset refers to the expected period of using a fixed assets. ;3. Fixed Assets Are Not Intended for Resale and Investment The purpose of obtaining a fixed asset is to serve the production and business activities. Companies can produce products through fixed assets, and earn sales revenue through the sale of products; Companies can rent fixed asset to others and earn rental income; Fixed assets can be used for administrative management so as to improve the management level of enterprises. ;4. Fixed Assets Have Measurable Future Economic Benefits The purpose of obtaining fixed assets are to earn future economic benefits,