AMSASI

In the world of accounting and finance, the concept of depreciation is a well-known method used to allocate the cost of tangible assets over time. However, not all assets fall under the depreciation umbrella. One such asset that stands immune to this accounting treatment is land. Land: A Timeless Asset Unveiling the Immortality When we think about assets, images of buildings, machinery, and equipment may come to mind – all subject to wear and tear over time. However, land, a cornerstone of tangible wealth, stands apart due to its timeless nature. Unlike structures and machinery, land does not succumb to the passage of time in the same way. It doesn't wear out, become obsolete, or lose its functionality. This everlasting quality makes land a unique entity in the realm of accounting. The Depreciation Dilemma Understanding Depreciation Basics Depreciation is a systematic allocation of the cost of an asset over its useful life. It acknowledges the wear and tear that assets undergo and

   What is Assets, Liabilities and Owner’s Equity? The two basic elements of a business are what it owns and what it owes.   What is Assets? The resources that a company controls or owns and that are anticipated to yield future advantages are its assets. For Example: Take the neighborhood eatery Campus Pizza, for instance. It has a delivery truck that it uses to deliver pizza, which brings it money. Campus Pizza also has a cash register, an oven, tables, seats, a jukebox, dinnerware, and, of course, cash.  There are three types for assets. Current Assets Non-current or Plant Assets Intangible Assets What is current Assets? The term "current assets" refers to assets that a business anticipates using up or turning into cash within a year or its operational cycle, whichever comes first. Accounts receivable, for instance, are considered current assets as the business plans to collect and turn them into cash within a year. Given that the corporation anticipates using up its supply

  Expenses Expenses  are the cost of assets consumed or services used in the process of earning revenue. They are  decreases in owner’s equity that result from operating the business .   For example, Campus Pizza recognizes the following expenses: cost of ingredients (meat, flour, cheese, tomato paste, mushrooms, etc.); cost of beverages; salaries and wages expense; utilities expense (electric, gas, and water expense); delivery expense (gasoline, repairs, licenses, etc.); supplies expense (napkins, detergents, aprons, etc.); rent expense; interest expense; and property tax expense.   Prepaid Expenses and Accrued Expenses When companies record payments of expenses that will benefit more than one accounting period, they record an asset called  prepaid expenses  or  prepayments . When expenses are prepaid, an asset account is increased (debited) to show the service or benefit that the company will receive in the future. Examples of common prepayments are insurance, supplies, advertising,

  Accounting   is the process of identifying, recording and communicating business transactions. Accounting involves three basic activities, Identifying, recording and communicating business transactions to the interested users. From the starting point of the accounting process, a company identify the economic transaction of its business. For example, the advertising expense of Amazon, the sale of Reliance and the payment of wages by TATA. Once a company like Amazon identifies economic events, it  records  those events to provide a history of its financial activities. Recording consists of keeping a  systematic ,  chronological diary of events , measured in dollars and cents. In the recording, Amazon also classifies and summarizes economic events.  Finally, Amazon  communicates  the collected information to interested users using  accounting reports . The most common of these reports are called  financial statements . To make the reported financial information meaningful, Amazon report