Archive: Jun 2011

Fixed Asset Valuation – Basic Definitions

The American Society of Appraisers Machinery and Equipment Committee released definitions of asset value and defining conditions for machinery and equipment appraisers nearly thirty years ago, and these are still used in fixed asset accounting today. Here are some basic definitions to keep in mind: Reproduction cost new: the current cost of duplicating a new item to make an exact replica. Replacement cost new: the current cost of a similar new item that has the nearest equivalent utility to the equipment being appraised. Fair market value: the price at which a piece of equipment or property should be valued in…

Read More

Fixed Asset Management 101

Fixed asset management is essentially a method of tracking inventory throughout its lifetime. Fixed assets can include office equipment, factory equipment and property. The chair you sit on at work is a fixed asset, as is your company laptop and perhaps even the building you work in. To manage fixed assets effectively, inventory tracking must be conducted at all stages of an asset’s life, from procurement to disposal. The four stages of the asset life cycle are: Planning for, purchasing and receiving the asset Day-to-day operations Managing the asset’s tax, depreciation and other associated costs Disposal A properly constructed asset…

Read More