COMM-1106EL Chapter Notes - Chapter 8: Software, Canada Revenue Agency, The Purchase Price
6 Dec 2016
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The three main categories of long-term assets (aka. capital assets) are: property, plant, and equipment (aka. Companies invest in long-term assets to generate future revenues. These assets generally have significant costs and will impact a company"s operations for many years into the future. They are often critical to a company"s future success and need to be understood by financial statement users. Key things users will want to do is: Users will want to monitor the age of a company"s long-term assets. Will want to understand the average age of these assets and be able to anticipate when future outflows of cash will be required to replace them. They will also need to know the implications these assets have on future costs by understanding the company"s depreciation and amortization policies. Users will also want to know if the company has determined whether there have been any significant negative changes in the expected use of the asset.
