ASSETS AND LIABILITIES

Balance sheet accounts are the assets and liabilities. When we set up your chart of accounts, Thera will be seperate sections and numbering schemes for the assets and liabilities that make upo the balance sheet.

A quick reminder: Increases assets with a debit and decreases them with a credit. Increases liabilities with a credit and decreasedx them with a debit.

Simply stateted, asssts are those things of value that your company owns. The cash in your bank account is an asset. So is the compnay car you drive. Assets are the objects, rights and claims owned by and having value for the firm. Since your company has right to yhe future collection of miney, accounts receivable are an asset - probably a major asset, at that. The machienary on your production floor is also as asset. If your form owns real estate or the other tabgible property, those are considered assets as well. If you were a bank, the loans you make wouid be considered assets since they represnt of right future collections.

Generally the value of intangible aseets in whatever both parties agree to when the assets are created. In the case of patent, the values is often linked to its development costs. Goodwill is often the difference between the purchases price of a company andf the value of the assets acquired.