Introduction to Fixed Assets (Grade 12 NSC Matric Accounting): Flashcards
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Fixed assets
Fixed assets
Long-term resources for operations, not for resale
Fixed assets vs inventory
Fixed assets vs inventory
Fixed assets used long-term; inventory sold quickly
Historical cost principle
Historical cost principle
Record assets at actual purchase price under GAAP
Cost price calculation
Cost price calculation
Purchase price + costs to ready for use
Asset register
Asset register
Database with details of all business assets
Asset register requirement
Asset register requirement
Must be current and accurate at all times
Depreciation
Depreciation
Decline in asset value from wear, tear, obsolescence
Straight-line method
Straight-line method
Spreads cost evenly over asset's useful life
Carrying value method
Carrying value method
Fixed % applied to remaining value each year
Year-end depreciation rule
Year-end depreciation rule
Calculate on all assets owned during the year