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Acquiring. Consuming. Owning.
In today's society, these are our favorite words. Discussions around many boardroom tables and wine bars center around prepping a budget to include the next asset acquisition.
How do we account for such valuable stuff?
Actually, it’s pretty easy. For most of us, we can get our head around tangible items we can see and touch.
Let's get started!
Assets start the party and come first on the balance sheet. Examples of assets include, cash, accounts receivable (although we haven't received the funds, they are DUE to us,) investments, fixed assets, intangible assets and other assets.
Assets are listed in order of liquidity. Cash is listed at the top because, duh, it is the king of liquidity. Yet land, for example, although extremely valuable, comes much later.
We place items on the balance sheet when the life of the asset is longer than one year. Pencils will obviously go to office supplies as an expense, but the computer you are reading this on will last substantially longer – therefore, we would categorize it as a fixed asset.
The major categories and types of items are:
If you are concerned your assets might be misplaced! (Ahh! There's nothing worse!)
Give me a ring at 336-262-5464 for a consult.
Hi! It's Bridgett here! Are you ready to take your business to a new level? Let's do it!
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