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Summary Summarized Tangible/Fixed Asset Note Number 3 $20.60   Add to cart
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Summary Summarized Tangible/Fixed Asset Note Number 3
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  • Course
  • Accounting
  • Institution
  • 12th Grade

This one of the best Summary of note number 3 in Accounting you will never regret getting. This Summary described everything you need to know and master when it comes to note number 3 with worked examples, and it also suitable for grade 10 - 12 learners.

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Document information

  • June 6, 2022
  • 6
  • 2021/2022
  • Summary

Subjects

  • tangible asset
  • fixed asset
  • note number 3
  • accounting
  • grade 12
  • summarized accounting
  • assets
  • depreciation
  • note no3
  • notes
  • disposal at carrying value

Written for

  • 12th Grade
  • Accounting
  • 2
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SIMPLIFIED TANGIBLE/FIXED ASSET NOTE NO.3
WITHEXAMPLES.

Fixed or Tangible Assets: This is a note where a business keeps track of all
records of transactions that concerns its long-term assets (tangible assets) of
which are Land and Buildings, Vehicles, and Equipment.

Core terms in the FIXED ASSETS

MEANING
TERMS

Accumulated It refers to an amount of a decrease in the value of
an asset expenditure provided to the asset since it
Depreciation was used.

It refers to a decrease in the value of an asset over
Depreciation time, because of being used.


Disposal at Is the carrying value of an asset that is being sold.

Carrying Value

understanding calculations of these core terms in words
(FORMULAS).


NB: Depreciation can be calculated using COST PRICE/STRAIGHT and CARRYING
VALUE/DIMINISHING methods. Period refers to a time frame that an asset
spent in a business until it sold.

, 1. Depreciation (pro-rata depreciation):
cost price x given percentage/100% x period
[ CP x GIVEN%/100% x PERIOD]
OR
Carrying value x given%/100% x period
[CV x GIVEN%/100% x Period]
2. Disposal at carrying value:
[Accumulated depreciation + pro-rata depreciation]


IMPORTANT
 Land and Building do not lose value/ depreciate.
 If Accumulated depreciation is greater than the cost,
carrying value of that asset must be equal to 1.
 Checking profit /loss- compare carrying value with the
price of sale.
PRACTICAL EXAMPLE:
Mntambo Traders on 28 Feb 2021.
Information on 1 March 2020.
Assets Cost Price Accumulated
depreciation
Vehicle R 150 000 R 27 000

Equipment R 200 000 R 33 000

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