For a manufacturing firm like golden Guinea plc to carry out its business successfully and to meet its main objectives it needs among. Other things fixed assets. The fixed assets unlike current assets are held over several period wish the objective or earning revenue. Hence, the amount of money spent on their purchase is treated as capital expenditure. Accepted expenditure refers to the amount spend by on organization of the acquisition of a permanent assets intended profits.
There are numerous example of these types of assets some of which are land and building, however, these comprise of the company’s factory building, offices and warehouses used for storage purpose, others include pant and machinery, fixtures and fittings and equipment. These assets are used by industries or manufacturing organization for actual transformation or raw material into sleazier finished goods. The last but not the least are nature resource. These consist of mine queries oil coal and gas deposits.
These are some time called lasting assets. Assets since they became worthless when the deposit or resources have been depleted. In addition, they are normally consumed in the services of the business by effusion of time that is by wear and tear.
This fixed assets are normally recorded in their book at then cost pride, but it is assured that after making use of them for some periods, usually more than one financial year their value and efficiency decrease.
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