Assets

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What is an asset?

Back

An asset is something valuable that a person or company owns, which can be used to generate income or can be sold for cash.

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What are examples of assets?

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Examples of assets include cash, real estate, vehicles, stocks, and equipment.

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What is the difference between current and fixed assets?

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Current assets are short-term assets that can be converted into cash within a year, like cash and inventory. Fixed assets are long-term assets, like buildings and machinery, that are used over time.

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How do you calculate the total value of assets?

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To calculate the total value of assets, add up the value of all individual assets owned.

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What is depreciation?

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Depreciation is the reduction in the value of an asset over time, often due to wear and tear.

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Why is it important to track assets?

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Tracking assets is important for understanding financial health, making informed decisions, and ensuring proper management.

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What is a balance sheet?

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A balance sheet is a financial statement that shows a company's assets, liabilities, and equity at a specific point in time.

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What is liquidity?

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Liquidity refers to how easily an asset can be converted into cash without losing value.

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What is an example of a liquid asset?

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An example of a liquid asset is cash or money in a checking account.

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What is an example of an illiquid asset?

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An example of an illiquid asset is real estate, which can take time to sell.