Chapter 8 Outline.docx - Chapter 8 Outline LONG-TERM AND...

This preview shows page 1 out of 2 pages.

Chapter 8 Outline LONG-TERM AND OTHER ASSETS 1) What Are the Different Types of Long-Term Assets? a. Fixed assets = physical (depreciation) b. Intangible assets = patents, trademarks, goodwill (amortization) c. Natural resources (depletion) 2) How Is the Cost of a Fixed Asset Calculated? a. Cost principle b. Asset cost + all amounts paid to acquire the asset and prepare if for its intended purpose. i. Does not include land improvement costs 3) How Are Fixed Assets Deprecated? a. Adheres to the matching principle b. Obsolete: newer asset can perform a job more efficiently than an old asset c. Residual value = salvage value i. Cost – residual value = depreciable cost d. Methods of depreciation i. Straight-line method 1. (cost - residual value) / estimated useful life in years = depreciation expense per year ii. Units of production method 1. (cost - residual value) / estimated useful life in years = depreciation expense per unit iii. Double-declining-balance method 1. Also known as accelerated depreciation 2.
Image of page 1
You've reached the end of this preview.

{[ snackBarMessage ]}

What students are saying

  • Left Quote Icon

    As a current student on this bumpy collegiate pathway, I stumbled upon Course Hero, where I can find study resources for nearly all my courses, get online help from tutors 24/7, and even share my old projects, papers, and lecture notes with other students.

    Student Picture

    Kiran Temple University Fox School of Business ‘17, Course Hero Intern

  • Left Quote Icon

    I cannot even describe how much Course Hero helped me this summer. It’s truly become something I can always rely on and help me. In the end, I was not only able to survive summer classes, but I was able to thrive thanks to Course Hero.

    Student Picture

    Dana University of Pennsylvania ‘17, Course Hero Intern

  • Left Quote Icon

    The ability to access any university’s resources through Course Hero proved invaluable in my case. I was behind on Tulane coursework and actually used UCLA’s materials to help me move forward and get everything together on time.

    Student Picture

    Jill Tulane University ‘16, Course Hero Intern