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What is the historical cost model?
Historical cost model is a valuation process for assets wherein they are valued at cost of acquisition plus all costs incidental to cost of acquisition.
What is the dual aspect concept?
Dual Aspect concept: This state that there are two aspects of accounting, one represented by the assets of the business and the other by the claims against them. The concept states that these two aspect are always equal to each other. In other words, this is the alternate form of the accounting equation: Assets=Liabilities+Capital Dual aspect concept is known as "Double Entry Book Keeping System".
Is goodwill privately owned?
Goodwill is an intangible asset that represents the value of a company's reputation, brand, customer relationships, and other non-physical factors that contribute to its profitability. While it is recorded on the balance sheet of a company, it is not "owned" in the traditional sense like physical assets; rather, it is an accounting concept that reflects the excess value paid in a business acquisition over its identifiable net assets. Goodwill is specific to the business it belongs to and is typically considered private property of that business entity.
Are the cost and fair market value of an asset the same at the time of acquisition and in all subsequent periods?
Yes
What is the budget and cost and concept of an indigenuos trader and a sole trader?
The budget and cost and concept for the indigenous trader and sole can vary depending on the company's budget. If there is not a deficit in the account then the budget cost can increase.
What is the historical cost model?
Historical cost model is a valuation process for assets wherein they are valued at cost of acquisition plus all costs incidental to cost of acquisition.
Why would there be negative goodwill on a purchaser's income statement rather than the seller's income statement?
Goodwill can be negative and arises where the net assets at the date of acquisition, fairly valued, exceed the cost of acquisition. Negative goodwill is recognized as a liability.
What is historical concept?
historical concept means tangible assets are record on the the original price, in which an assets is acquired.
What is hawaiian acquisition?
Hawaiian acquisition refers to the process by which a company or individual acquires ownership or control of assets, businesses, or properties in Hawaii. This can include purchases of real estate, businesses, or other assets in the state of Hawaii.
What is the meaning of 'historical cost accounting'?
Historical cost accounting is an accounting concept that states that all assets in the financial statement should be reported based on their original cost . Example : James buys a building for $2,000,000 ten years ago, the value of the building now is $3,000,000 but in James's accounting records, the building is still recorded as $2,000,000 (less depreciation). No account is taken of the increase in value.
How would you describe a replacement cost?
Replacement cost. Acquisition cost at the date of measurement, typically the present, in contrast to the earlier date of acquisition.
Is the acquisition of non current assets included in the income statement?
Acquisition amount of purchase of non-current asset is shown in balance sheet while any profit or loss incurred for purchase of assets is shown in income statement.
Why you use accumulated depreciation and not reduce depreciation from asset directly?
Basically the concept is to provide more detailed information and a method of checks and balances against the depreciation. The original acquisition cost of the asset is preserved this way and always appears until the asset is disposed. If you simply reduced the asset every year by the depreciation amount there would be less information for outsiders to understand why the asset keeps decreasing, or have the ability to distinguish whether you have new, low cost assets or a bunch of ancient assets which are almost completely depreciated.
What is the difference between asset acquisition and asset requisition?
Asset acquisition refers to the process of purchasing or obtaining assets, typically through a transaction that transfers ownership, such as buying a company or its specific assets. In contrast, asset requisition often involves a formal request to obtain assets, usually within an organization, where assets are allocated or assigned based on need rather than purchased. Essentially, acquisition involves ownership transfer, while requisition focuses on internal resource allocation.
How is fair value determined in acquisition?
Fair value in an acquisition is determined by assessing the market value of the acquired assets and liabilities, often using various valuation techniques. These can include the income approach, which estimates future cash flows discounted to present value, the market approach, which compares similar transactions, and the cost approach, which evaluates the replacement cost of assets. Additionally, factors such as synergies, market conditions, and the specific circumstances of the acquisition can influence the fair value assessment. Ultimately, fair value reflects the price that would be received to sell an asset in an orderly transaction between market participants.
In a firm where assets are the major cost how is profit maximized?
By increasing revenues or the cost of the assets.
Which budget summarizes management future plans for the acquisition of fixed assets?
Capital expenditures budget.
