BU227 Chapter Notes -Chief Executive Officer, Intangible Asset, Promissory Note
Document Summary
Long lived assets used in the operation of a business are divided into categories: property, plant, and equipment (tangible capital or fixed assets, intangible assets. The cost of any asset is the sum of all the costs incurred to bring the asset to its intended use. Buildings (construction): architectural fees, building permits, contractor"s charges, materials, labour, Buildings (purchase): purchase price, brokerage commissions, sales and other taxes, Machinery and equipment: purchase price (less discounts), transportation charges, insurance in transit, Sales and other taxes, purchase commission, installation costs, expenditures (testing), special platforms. Land: purchase price, real estate commission, survey fees, legal fees, property. Land improvements: are all improvements located on the land but subject to decay: paving, fences, sprinkler systems, lighting in parking lot. Land improvement costs are not included in the cost of the land, but carried as a separate asset. Leasehold improvements: appears on the company"s balance sheet as leasehold. Improvements : amortized over the term of the lease.
