ADM 1340 Lecture Notes - Lecture 9: Asset Turnover, Land Development, Book Value

• School: University of Ottawa
• Department: Administration
• Course: ADM 1340
• Professor: Lamia Chourou

Document Summary

Have physical substance (a definite size and shape), Are used in the operations of a business, and are not intended for sale to customers. Also known as fixed assets and capital assets. Are required to maintain an asset in its normal condition and often recur, although not always annually. Include costs that increase the life of an asset or its. Are normally larger than operating expenditures and occur less frequently. Often subdivided into four classes: land, land improvement, buildings, equipment, the cost of land can include: Closing costs such as title, legal fees, and survey costs. Costs incurred to prepare the land for its intended use such as clearing, grading, and filling. The cost of land is not depreciated because it has an unlimited useful life. Decline in service potential, and require maintenance and replacement to keep their value. Land improvements are recorded separately from land and depreciated.