FIXED ASSETS Meaning and
Definition
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Fixed assets are tangible or physical assets that are long-term in nature, used by a business to generate income or provide goods and services. These assets are not intended for sale but rather for utilization in the operations of the business over an extended period of time. They are generally held for more than one accounting period and are not easily converted into cash without disrupting normal business operations.
Examples of fixed assets include land, buildings, machinery, vehicles, furniture, equipment, and tools. These assets are necessary for carrying out business activities and are essential for the production or delivery of goods and services. Fixed assets are typically recorded on the balance sheet of a company and are reported at cost less accumulated depreciation.
Depreciation, a systematic allocation of the cost of a fixed asset over its useful life, is applied to reflect the decline in value or usefulness of the asset due to wear and tear, obsolescence, or other factors. This allocation is done to match the cost of the asset with the revenues it helps generate during its useful life.
Fixed assets differ from current assets, such as cash, inventory, and accounts receivable, which are expected to be consumed or converted into cash within one year. They represent a long-term investment in the productive capacity of a business and play a crucial role in its ongoing operations and growth.
Common Misspellings for FIXED ASSETS
- fixd asset
- dixed assets
- cixed assets
- vixed assets
- gixed assets
- tixed assets
- rixed assets
- fuxed assets
- fjxed assets
- fkxed assets
- foxed assets
- f9xed assets
- f8xed assets
- fized assets
- ficed assets
- fided assets
- fised assets
- fixwd assets
- fixsd assets
- fixdd assets
Etymology of FIXED ASSETS
The term "fixed assets" is a compound phrase formed from the combination of the words "fixed" and "assets".
"Fixed" in this context refers to something that is stable, immovable, or unchanging. It comes from the Latin word "fixus", meaning "fastened" or "attached". The word "fixed" in English has been used since the late 14th century to refer to something firmly established or in a stable position.
"Assets" is a plural form of the word "asset", which comes from the Old French word "assez", meaning "enough" or "plenty". The term "asset" has been used in English since the late 16th century to denote something of value owned by an individual or organization.
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