BU121 Chapter Notes - Chapter 9: Intangible Asset, Book Value, Fixed Asset
Document Summary
Chapter 9: reporing and interpreing property plant and equipment, natural resources and intangibles. Acquisiion and maintenance of property plant an equipment. Long lived assets are tangible or intangible resources owned by a business and used in its operaions to produce beneits over several years. Tangible assets: physical substance such as land (never depreciated), buildings, equipment and natural resources. Intangible resources: no physical substance such as sotware, landing rights or intellectual property. How efecive is management at uilizing its property plant and equipment to generate revenues. The cost principle requires all cash and non cash equivalents to be incurred in acquiring a long lived asset, placing it in its operaional seing and preparing it for use. Costs are capitalized when they are recorded as assets rather than expenses such as sales tax, transportaion costs and installaion costs (excluding special discounts and interest charges). Same with land but land is recorded as a separate asset.
