Flashcard-Fixed Assets

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Characteristics of Fixed Assets

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1. Exist physically and are tangible assets. 2. Owned and used by the company in its normal operations. 3. Not offered for sale as part of normal operations.

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Long-lived assets not used in normal operations and held for future resale.

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Definition of Investments

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Costs that benefit only the current period.

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Revenue Expenditures

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Costs that improve the asset or extend its useful life.

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Capital Expenditures

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Exclusive rights to produce and sell goods with unique features. Amortization is normally computed using the straight-line method.

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Patents

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The exclusive right to publish and sell a literary, artistic, or musical composition.

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Copyright

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A name, term, or symbol used to identify a business and its products.

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Trademark

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An intangible asset created from favorable factors such as location, product quality, reputation, and managerial skill.

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Goodwill

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Cost less accumulated depreciation.

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Book Value of Fixed Assets

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Depreciable Value of Fixed Assets

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Cost less residual value.