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useful life of fixed asset
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∙ 14y ago
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Are fixed assets expenses?
Yes and no. When a company purchases a fixed asset it is expensed through depreciation over the useful life of the asset.
What is useful life of an asset?
Useful life of an asset means the time for which any asset is usable in business for generating revenue for business.
How do you detemine an assets useful life?
According to useful life of an asset.
Process of spreading the cost over an asset's useful life?
Expensing is the process of spreading the cost over an asset's useful life.
Is depriciation a fixed cost?
Yes depreciation is a fixed cost of business which is an allocation of fixed asset cost over period of asset life.
Are fixed assets expenses?
Yes and no. When a company purchases a fixed asset it is expensed through depreciation over the useful life of the asset.
What is depreciation and why is it included in the balance sheet?
Depreciation is allocation of fixed asset cost to income statement of useful life of asset that's why shown as reduction in fixed asset value.
Are expenses assets?
Yes and no. When a company purchases a fixed asset it is expensed through depreciation over the useful life of the asset.
What is a fixed asset equipment depreciation schedule?
It is the schadule to show how fixed assets will depreciate in their useful life and show all information according to useful life the depreciation expense charge to income statement and to dispose off them in the end.
What is useful life of an asset?
Useful life of an asset means the time for which any asset is usable in business for generating revenue for business.
What is the estimated salvage value of a fixed asset?
The estimated salvage value of a fixed asset refers to the expected residual value of the asset at the end of its useful life. It is an estimate of how much the asset could be sold for or its scrap value. This value is important for calculating depreciation expenses and determining the asset's net book value. The specific salvage value can vary depending on factors such as market conditions, technological advancements, and the condition of the asset.
How do you detemine an assets useful life?
According to useful life of an asset.
What is capitalisation of fixed assets?
Capitalization of fixed assets means the assets which are acquired with a useful life of atleast two years, and recording the cost of that fixed asset in balance sheet. When an asset is removed from the work in process (WIP) category and is recorded in book of accounts as an asset that can start generating revenue, it is then that it can start to be capitalised and duly depreciated.
Process of spreading the cost over an asset's useful life?
Expensing is the process of spreading the cost over an asset's useful life.
Is depriciation a fixed cost?
Yes depreciation is a fixed cost of business which is an allocation of fixed asset cost over period of asset life.
Distinguish between economic life and useful life?
the useful life of an asset is the period over which an asset is expected to be available for use by an entity whiles economic life is the period over which an asset is expected to be useable by one or users
Do you include warranty charges on the initial cost of a fixed asset?
Include the cost of extended maintenance/warranty contracts in the asset valuation if the contract is purchased at the same time (or soon thereafter) as the capital asset. Depreciate these contracts over the useful life of the asset not the the contract life. Do not capitalize payments for contracts not purchased at the same time as the capital asset.
