LeoGlossary: Asset

2 mo (edited)
LeoFinance
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How to get a Hive Account


This is any resource that is owned by an individual or business. It has future economic value, potentially creating cashflow for the individual or business. Ultimately, they help to increase the firm's value. It is also something that can be converted to cash.

An asset is a part of the balance sheet and found on the left hand side. When it comes to investing along with running a business, the ratio of assets to liabilities is something that many watch.

According to the formula on a balance sheet:

Assets = Liabilities + equity

Types of Assets

Tangible

  • Current: cash, inventory, accounts receivable
  • Fixed: land, building equipment

Intangible

Wasting Asset

This is an asset that loses value over time. It can be vehicles and machinery. This is treated differently for tax purposes. These require the introduction of depreciation to the financial accounting.

General:

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