What Are Business Assets And Why They Are Important

What Are Business Assets

If someone wants to start his career in the field of finance then, he must be aware of the business assets and other terminology that is used to describe the business assets.

What Are Business Assets

A business asset is something that has some value and is owned by a company for its business operations. A business asset can be tangible such as a vehicle and machine, or intangible such as goodwill or copyrights.

The main purpose of acquiring business assets is to use them in a business for completing production or manufacturing. These assets are recorded in the balance sheet as current or non-current assets as per their use and nature. Normally business assets are recorded on the historical cost rather than market value.

Most of the business assets such as fixed or non-current assets are depreciated and lose their value over their useful life.

Are business assets current asset
What Are Business Assets

Tangible Business Assets

  • Cash
  • Land
  • Machine
  • Inventory
  • Vehicles, etc.

Read the detailed article on tangible assets

Intangible Business Assets

  • Goodwill
  • Patents
  • Copyrights
  • License
  • Trademark, etc

Read the detailed article on intangible assets

Business Assets That Are Liquid

  • Cash
  • Inventory
  • Merchandise
  • Account Receivable
  • Notes Receivables, etc.

Read the detailed article on current assets

Non-Current Business Assets

  • Furniture and Fixture
  • Building
  • Office Equipment
  • Machinery
  • Land, etc.

Read the detailed article on non-current assets

Why Business Assets Are Important

The followings are the major reasons why business assets are important.

  • Business assets play a crucial role in generating the sales
  • These business assets are acquired for a long term that increases the wealth of the company
  • Business assets increase the efficiency, capacity, and productivity of a company
  • Business assets such as a patent or a trademark represent a unique brand in the market that increases the net worth of a business
  • Business assets help a business in obtaining the finance opportunities
  • Business assets that are liquid can help a business to manage its present obligations
  • Business assets can mitigate the risk by diversification
  • Business assets play a vital role in the continuity and progress of a business

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