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    Accounting for Long-Term Assets

    Most businesses, no matter their size, invest in long-term assets. Long-term assets include physical assets as well as assets without a physical substance. Long-term physical assets are also referred to as capital assets, plant assets or fixed assets; and include property (land and natural resource properties), plant (buildings, offices, factories and warehouses), and equipment (machinery, furniture, and tools). Long-term non-physical assets are often referred to as intangible assets, and include items such as goodwill. 

    In accounting, the matching principle requires that the cost of any long-term asset is allocated to different accounting periods over its useful life. We call this allocation of costs, generally, "amortization." Amortization is a special concern when accounting for long-term assets. 

    Depreciation: Depreciation is the term used specifically for the amortization of property, plant and equipment.

    Depletion: Depletion is the term used specifically for the amortization of natural resource properties.

    Amortization: Amortization traditionally refers to the amortization of costs for intangible assets. It is no used more generally to include depreciation and depletion. 

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    BrainMass Categories within Accounting for Long-Term Assets

    Intangible Assets

    Solutions: 42

    Intangible assets have value based on the rights and privileges granted to the company using them, such as patents, copyrights, trademarks, trade secrets, franchise or license agreements, computer software, goodwill, and some development costs.

    Natural Resources

    Solutions: 4

    Natural resources are assets that are measured after acquisition based on depletion.

    BrainMass Solutions Available for Instant Download

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    Eliminating Agency Problems

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    Net asset value, rate of return, and mutual fund investment strategies

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    Asset Betas

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    Asset Securitization Structures

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    Long-Term Asset

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    Asset Carrying Amount

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    Current vs, Long Term Assets

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    Trade in asset for two situations

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    Asset Impairment

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    Asset Classes Paper

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    U.S. Capital Markets Total Annual Returns

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    Effective annual percentage cost of funds

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    Evaluate, compare, and contrast the asset allocation strategies

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    Net Salvage Value and Selling Price

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    The expected return on a two-asset portfolio

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    An asset is just an expense waiting to happen: discuss the concept.

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    Reasons for internationally diversifying one's portfolio

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    Asset Classes for Caterpiller and a mutual fund

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    Two-Asset Portfolio

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    Determining Asset Classes for a Selected Mutual Fund

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    Intercompany asset transactions and consolidated financials.

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    Expected return on a three-asset portfolio; Hennessy's portfolio risk

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    E8-6 Asset Disposal

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