fixed and current assets

Question 1

what is an asset?

Answer 1

something that an enterprise owns

Question 2

what are 7 examples of assets?

Answer 2

• cars/trucks
• computer equipment
• machinery
• business premises
• inventory
• cash in the bank
• money owned to the enterprise by the customers

Question 3

current assets

Answer 3

either cash (money) or items that can be converted into cash very easily

Question 4

types of current assets: inventory
what can raw materials be used for?

Answer 4

can be used to make products

Question 5

types of current assets: inventory
what are products held in the future for?

Answer 5

for future sales to customers

Question 6

types of current assets: cash
how is it received from customers in payment for?

Answer 6

received from customers in payment for goods and deposited in the bank

Question 7

types of current assets: debtors
who are debtors?

Answer 7

customers who owe money to the enterprise

Question 8

how do you calculate the value of current assets?

Answer 8

Current assets = Value of inventory + Cash at bank + Debtors

Question 9

what is a fixed asset?

Answer 9

an item that enables products
to be made and is not expected to be converted into cash any sooner than one year’s time.

Question 10

what are 4 examples of fixed assets?

Answer 10

• vehicles
• computers and equipment
• fixtures and fittings
• business premises owned by the enterprise

Question 11

how do you calculate the fixed assets?

Answer 11

adding together the value of each fixed asset

Question 12

how do you calculate total assets?

Answer 12

Total assets = Current assets + Fixed assets