ACTG 2011 Lecture Notes - Lecture 1: Intangible Asset, Capital Cost, Historical Cost
Document Summary
Actg 2011 lecture 1 (long term assets) Contribute to earning revenues over more than one period: examples: table, chairs, equipment, building. Inventory is bought and sold (purpose is to resell: capital assets are used to make products (don"t sell off) Property, plant and equipment: tangible assets used to price or supply goods or services to customer, rented to customers, or used for admin purposes: examples: land, buildings, equipment, vehicles, computers. Intangible assets: capital assets without physical substance: ex: patents, copyrights, trademarks, brand names, computer software. Goodwill: an intangible asset that arises when one business acquires another and pays more than the fair value of the net assets purchased. All costs associated with asset being acquired and ready for use. May or may not include wages of employees. Betterment may increase useful life, efficiency or effectiveness. Repairs allow asset to operate as intended. Betterments are capitalized, repairs are expensed: ex. Economic benefit of the asset is used up.
