What is an Asset?
Definition: An asset is any resource that can be 'Owned' or 'controlled' by a business entity to generate economic benefits(Profits).
Explanation:
As defined above, any resource which owned or controlled by a business which generate profits is called an asset. In accounting assets are classified in to two major categories: Tangible assets & Intangible assets.
Tangible assets are divided in to two kinds:
Current assets, & Non-Current assets.
Current assets include:
- Cash
- Bank balance
- Inventory
- Prepaid expenses
- Debtors/ Account receivable.
- Advance payments, etc.
- Land
- Building
- Plant
- Machinery
- Equipment
- Long-term investments
- Right of use, etc.
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