If you purchased a fixed asset and you didn't pay for it all when you bought it, then you took on a debt liability. This does not accrue. It's there in full until it is paid off. Interest expense is recorded in its own account too. Interest accrues.
if software is purchased and price is paid at once and used for many years then it is fixed asset but if you purchase a software and after that every year you need to renew the license of using that software then this lisence cost is current asset and price paid for purchasing software is fixed asset. For Example: software purchased for $1000 and lisence renew fee for every year is $100 then $1000 is fixed asset and $100 is current asset or revenue asset.
Debit Accumulated Depreciation Credit Fixed Asset If there the asset has a net book value, then you will have to Debit or Credit Gain or Loss on Sale of Asset for the difference. Also, you may have received money if the asset was sold or there may be a loan to payoff. Those transactions will need to be included in your entry as well.
under NET ASSET VALUE method all the ASSETS-LIABILITIES we need to calculate
current assets are not depreciated because depreciation process is use to allocate long term asset cost to specific fiscal year in which it used if fixed assets also fully used in one fiscal year then there is no need of depreciation as well.
Yes normally rent is fixed expense and need to be paid even there is no production at all.
if software is purchased and price is paid at once and used for many years then it is fixed asset but if you purchase a software and after that every year you need to renew the license of using that software then this lisence cost is current asset and price paid for purchasing software is fixed asset. For Example: software purchased for $1000 and lisence renew fee for every year is $100 then $1000 is fixed asset and $100 is current asset or revenue asset.
Is investment in government bond ,government securities, other asset ,investment in equity share and leasehold land are they a fixed asset of current asset please identify these all please need help on these.
Debit Accumulated Depreciation Credit Fixed Asset If there the asset has a net book value, then you will have to Debit or Credit Gain or Loss on Sale of Asset for the difference. Also, you may have received money if the asset was sold or there may be a loan to payoff. Those transactions will need to be included in your entry as well.
Answer:Even though cash has been spent on purchasing the fixed asset, accounting principles will prescribe that an asset needs to be recognized. This is an application of the matching principle, which states that cash expenditures need to be allocated as an expense in the period where they generate revenue. Suppose the fixed asset is a machine, which will be used to produce goods, which will be sold at a profit. The sales will be recorded as the products are sold during the economic lifetime. Hence, the purchase price of the fixed asset needs to be allocated (spread) over the economic lifetime as well. The expense is called depreciation expense.
IT asset management is a company-specific structured process for tracking hardware and software from acquisition to disposal. You should learn about the background and history of fixed asset treatment,you should also know about embedded cost opportunities, bonus depreciation and intangible asset management.
There are quite a few asset management systems on the market but one of the best ones out there is called Fixed Asset Pro. It is a fraction of the price of the other programs at the low price of $150. In addition, it is a self contained system so you don't need to install 3rd party software.
No. Volunteer means unpaid.
Yes you can, but you need a passport.
Depreciation is a systematic allocation of the cost of a fixed asset over its useful life. It is not tied directly to the physical condition of the asset but is an accounting method to match the cost of the asset with the revenue it generates over time. Even when fixed assets are properly maintained and remain in good physical condition, they still undergo wear and tear or obsolescence over time. Depreciation reflects the gradual decrease in the asset's value as it contributes to generating revenue for the business. Here are a few reasons why depreciation is considered necessary, even for well-maintained fixed assets: **Matching Principle:** Depreciation aligns with the matching principle in accounting, where the costs associated with generating revenue should be recognized in the same period as the revenue is earned. Allocating the cost of an asset over its useful life helps in presenting a more accurate picture of the business's financial performance. **Asset Replacement:** Even if an asset is well-maintained, it will eventually need replacement due to technological advancements or changing business needs. Depreciation allows a business to set aside funds for the eventual replacement of the asset. **Financial Reporting:** Depreciation is crucial for providing a true and fair view of a company's financial position. It helps in presenting a more accurate balance sheet by reflecting the reduction in the value of fixed assets over time. **Tax Deductions:** Depreciation is often tax-deductible, providing businesses with tax benefits over the useful life of the asset. This can significantly impact a company's cash flow and tax liability. In summary, while proper maintenance can extend the physical life of fixed assets, depreciation is still necessary for accurate financial reporting, adhering to accounting principles, planning for asset replacement, and realizing tax benefits. It's a financial concept rather than a direct reflection of an asset's condition.
Expenditure is that amount which is paid in advance and benefit of which amount is need to be taken for more than one fiscal year like asset expenditureDebit fixed assetCredit cash / bank
yes i need my broken screen to be fixed
need a cheap dentist on a fixed income.