会计专业英语 第5章 Non-current.pptxVIP

5.1FixedAssets

5.1.1DefinitionandCharacteristicsofFixedAssets

Long-livedassetsacquiredforuseintheoperationofthe

businessbutnotintendedforresaletocustomers.

Thecommonexamplesoffixedassetsincludehouses,buildings,

machinery,vehicleandotherequipmentandtoolsrelatedto

productionandoperation.

.

1.FixedAssetsBelongtoTangibleAssets

◦Fixedassetsareexistingentitieswhichcanbeseen

andfelt.Theyaredifferentfromintangibleassets,

accountsreceivable,andotherreceivables.

◦Foranintangibleasset,althoughitcanbeusedfor

alongtime,andevenitsusefullifeexceedsthe

usefullifeoffixedassets,itcannotbeusedasfixed

assetsbecauseofitsinvisibility.

Inpractice,mostofcasharedepositedinbank

andacompanyneedstoreconcilewithbankby

preparingbankreconciliations.

Usually,therearetwosectionsinthebank

reconciliation.

◦Thefirstsectionbeginswithcashbalanceinthebank

statementandendswiththeadjustedbalance.

◦Thesecondsectionstartswiththecashbalanceinthe

company’s(depositor’s)journalofcashandendswith

theadjustedbalance.

◦Thesetwoadjustedbalancesmustbeequal.

2.FixedAssetCanBeUsedforaLongTime

◦Fixedassetisalong-termdurableasset,whose

usefullifeismorethanoneaccountingperiod.

◦Generally,theusefullifeofafixedassetrefersto

theexpectedperiodofusingafixedassets.

3.FixedAssetsAreNotIntendedforResaleand

Investment

◦Thepurposeofobtainingafixedassetistoservethe

productionandbusinessactivities.

Companiescanproduceproductsthroughfixedassets,and

earnsalesrevenuethroughthesaleofproducts;

Companiescanrentfixedassettoothersandearnrental

income;

◦Fixedassetscanbeusedforadministrativemanagement

soastoimprovethemanagementlevelofe