文档介绍：Chapter 10 Fixed Assets and Intangible Assets
Chapter 10
Fixed Assets and Intangible Assets
11>. Nature of Fixed Assets
2. Accounting for Depreciation
3. Capital and Revenue Expenditures
4. Disposal of Fixed Assets
5. Intangible Assets
6. Financial Reporting for Fixed Assets and Intangible Assets
Contents
Nature of Fixed Assets
Fixed assets are long term or relatively permanent assets
Fixed assets are tangible assets because they exist physically.
They are owned and used by the business and are not held for sale as part of normal operations.
Fixed Assets/ Property, plant and equipment (PPE) / Tangible assets固定资产: Assets held by the business that have useful lives of more than 1 year.
Classifying Costs
Is the purchased item long-lived?
Yes
Is the asset used in a productive purpose?
No
Expense
Yes
Fixed Assets
No
Investment
The costs of acquiring fixed assets include all amounts spent to get the asset in place and ready for use.
Acquisition cost include invoice amounts (less any discount)、sales taxes、transportation charges、installation costs、costs of trial runs to adjust equipment and costs to refurnish equipment purchased in a used condition.
Costs associated with new construction, such as labor and materials, should be reflected in a “Construction in progress” account.
Acquisition Cost
Sales taxes
Freight
Installation
Repairs (purchase of used equipment)
Reconditioning (purchase of used equipment)
Machinery and Equipment
Machinery and Equipment
Insurance while in transit
Assembly
Modifying for use
Testing for use
Permits from governmental agencies
Cost of Acquiring Fixed Assets Excludes:
Vandalism
Mistakes in installation
Uninsured theft
Damage during unpacking and installing
Fines for not obtaining proper permits from government agencies
Classification of Acquisition
Acquisition for Cash
Acquisition through Leasing
Operating lease 经营性租赁
Financing lease 融资性租赁
Acquisition from Donation
Acquisition through Self-con