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Types of assets, liabilities, and equity

Types of assets, liabilities, and equity
Types of assets, liabilities, and equity

Asset types

Assets are things that a company owns from resources obtained through transactions, and have a future economic value that can be measured and expressed in dollars. Assets also include upfront costs, which have not yet expired such as prepaid advertising, prepaid insurance, upfront legal fees, and rent paid In advance, examples of asset accounts reported on a company's balance sheet include:
  • Cash.
  • temporary investments.
  • accounts receivable.
  • Inventory.
  • supplies.
  • Prepaid insurance.
  • lands. Real estate.
Accountants classify the balance sheet accounts presented in distinct groups, categories, or classifications, which show the types of assets, liabilities, and equity. The maximum crucial kinds of belongings which are labeled and the order in their look withinside the stability sheet are:

Assets

Current belongings are short-time period monetary sources which can be predicted to be transformed into coins inside one year. Current assets include cash, cash equivalents, accounts receivable, inventory, and various prepaid expenses. Since the value of cash is easy, accountants periodically reassess the recoverability of inventory and account receivable so That if there is evidence that accounts receivable may be uncollectible it will become impaired or if inventory becomes old then companies may write off these assets.

Fixed assets

Fixed assets are long-term resources such as plants, equipment, and buildings An adjustment is made to fixed assets based on a periodic charge called depreciation which may or may not reflect a loss of powers to earn fixed assets. The constant loses its value in proportion to its useful life, while the accelerated method assumes that the asset loses value faster in the first years of its use.

financial assets

Financial belongings constitute investments withinside the belongings and securities of different institutions. Financial assets include stocks, sovereign bonds, corporations, preferred stock and other hybrid securities. Financial assets are valued depending on how the investment is classified and the motivation behind it.

Intangible assets

Intangible assets are economic resources that do not have a physical existence and include patents, trademarks, copyrights, and goodwill. Their accounting for intangible assets differs from intangible assets depending on the type of asset and can be terminated or tested for impairment each year.

opponent types

Liabilities are defined as legal financial debts to the company or obligations that arise during the course of business operations. Liabilities are settled over time through the transfer of economic benefits, including money, goods or services. Liabilities recorded on the right side of the balance sheet include loans, accounts payable, and mortgages. And deferred revenues and accrued expenses. Therefore, it is necessary to know the types of assets, liabilities, and property rights. The most important types of liabilities are the following:

Current Liabilities

Like most assets, liabilities are stated at cost rather than market value and under GAAP rules they can be listed in order of preference as long as they are classified. Examples of common current liabilities include:
  • Wages Payable: The total amount of accrued income that employees have earned but not yet received.Since most companies pay their employees every two weeks, this liability changes frequently.
  • Interest Payable: Businesses like individuals use credit to purchase goods and services for financing over short periods of time and this represents the interest on short-term credit purchases to be paid.
  • Dividends payable: For companies that issued shares to investors and pay dividends, this represents the amount due to shareholders after the announcement of dividends. This period takes about two weeks, so these obligations usually appear four times a year until the dividends are paid.
  • Unearned Revenue: This is the company's responsibility to deliver goods and/or services at a later date after being paid in advance, as this amount will be reduced in the future once the product or service is delivered.
  • Discontinued Operations Liabilities: This is a unique liability that most people see but should be closely scrutinized as companies have to calculate the financial impact of an operation, division or entity that is currently held for sale or has recently been sold, and this also includes the financial impact of a discontinued or discontinued production line Recently closed.

Non-current liabilities

Companies of all sizes finance part of their long-term ongoing operations by issuing bonds that are essentially loans to each party that buys bonds that keeps changing, as bonds are issued, matured, or called by the issuer. Examples of non-current liabilities include the following: :
  • Warranty Liability: The estimated amount of time and money that can be sent to repair products based on the warranty agreement.
  • Deferred Credits: This is a broad category that can be recorded as current or not current based on transaction details. It is revenue that is primarily collected before it is earned and recorded in the income statement and may include advances to customers, deferred revenue, or transactions where credits are due but are not revenue Once the revenue is deferred, this component is reduced by the amount earned and becomes part of the company's revenue stream.
  • Post-employment benefits: These are benefits that an employee or family members may receive when they retire and that are incurred as a long-term liability when they become due.
  • Unamortized Investment Tax Credits: Represents the net between the historical cost of an asset and the amount actually depreciated. This unamortized rate is a liability but is only a rough estimate of the asset's fair market value.

Types of property rights

property rights are guaranteed by clearly defined laws, enforced by the state. These laws define property, and any associated advantages that come with owning property. The term property is highly expansive although legal protections for certain types of property vary between states.

Accordingly: it is necessary to know the types of assets, liabilities and property rights, and ownership is generally owned by individuals or a small group of people, and property rights give the owner or the right holder the ability to deal with his property, and this includes: holding onto it, selling it, or renting it from For-profit or transfer it to another party. Among the most important types of property rights are the following.

Patents patent

Patents patent is protection for an invention granted by the United States Patent and Trademark Office (PTO) for a period of 14 to 20 years during which a person is granted the right to prevent another person from making, using, or selling the same invention without permission. The patents that entrepreneurs use most often:

design patent

It provides protection from the appearance of the design of the invention and is usually less expensive, faster to file, and easier to accept by the PTO than other types of patents, however, its blanket protection is not as effective as a companion patent because the design of the invention can be changed many times which helps others who wish to use your design to avoid infringement of 14-year patents.

utility patent

This patent is more complex than a design patent; Because it requires an explanation of how the invention will be used, the utility use patent is often higher, requires more input from a lawyer and is more difficult to get issued by a PTO, yet it is more protected than a design patent because patenting a method or function provides stronger, broader coverage and duration 20 years.

Trademarks

Any word, words or symbols that represent a product to identify and distinguish it from other products in the market eg the word brand will be Rollerblades The brand symbol will be the peacock used by NBC The symbols TM and ® are used with brands where TM can be used next to the mark Private, directly but the registration symbol ® may only be used when the mark is registered with the PTO as it is illegal to use this symbol prior to receipt of a registration issued by the PTO.

Copyright

Copyright is the legal protection of the way someone expresses their idea and this type of protection is mostly granted to authors, artists, composers and programmers. The example is only an exact copy of the word order that constitutes copyright infringement of a book or part of a book.
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