Non Current Assets Definition:
A non-current asset is an asset that the company acquires or invests, but the value of that investment does not recur within an accounting year. These type of investments lasts for long and cannot be easily liquidated into cash and can generate economic benefits to the company for more than a year.
In other words, the company capitalises the cost of the assets or investment for a long time or many years, rather than evaluating it within the year of purchase of the asset. Non-current asset appears in the balance sheet of the company.
List of Non-Current Assets:
Property, plant and equipment: These non-current assets are incorporate of both tangible and fixed assets and cannot be liquidated into cash easily. Which includes:
- Property like land, building, etc.,
- Plant-like manufacturing companies
- Equipment, machinery
Intangible Assets: This asset does not have a physical appearance and can be intellectual properties. It is considered as a non-current asset because it cannot be liquidated to cash with 12 months of the investment. Some examples are:
- Patent
- Trademark
- Copyright
Additional Reading: List of Current Assets
Balance Sheet Categorisation
- Non-current assets are categorised on the balance sheet under the heading of investment, property, plant, equipment, intangible assets, etc.,
- The assets are classified according to the segment of the balance sheet
- Investments are always labelled as a non-current asset only if the total expected return is not expected within the next 12 months of the balance sheet
- Property, plant, land, buildings, and machinery including vehicles are fixed asset
- Intangible assets are goods that have no physical presence
- Intangible assets may also arise from the sale or purchase of a business unit
Students can also learn:Â Difference between Assets and Liabilities
|
GRACY COMPANY Balance Sheet December 21, 2018 |
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|
Assets |
₹ | Liabilities |
₹ |
| Current Assets | Current Liabilities | ||
| Cash                 XXX | Accounts Payable       XXX | ||
| Short-term Investments  XXX | Salaries Payable        XXX | ||
| Accounts Receivables   XXX | Interest Payable        XXX | ||
| Inventories             XXX | Taxes Payable          XXX | ||
| Prepaid Insurance        XXX |
XXXX |
Current position of note    XXX |
XXXX |
| Long-term Investments | Long-term Liabilities | ||
| Stock Investments       XXX | Notes Payable          XXX | ||
| Cash Value of Insurance   XXX |
XXXX |
Bank Loan            XXX | |
| Property, Plant and Investment | Mortgage Obligation    XXX | ||
| Land |
XXXX |
Deferred Income Taxes   XXX |
XXXX |
| Buildings & Equipments XXX |
Total Liabilities |
XXXXX |
|
| (-)Accum. Depreciation (XXX) |
XXXX |
||
|
XXXX |
|||
| Intangible Assets | Stockholders’ Equity | ||
| Goodwill |
XXXX |
Capital Stock          XXX | |
| Other Assets | Retained Earnings        XXX | ||
| Receivables for the employee |
XXXX |
Total Stockholders’ Equity |
XXXX |
|
Total Assets |
XXXXX |
Total Liabilities and Equity |
XXXXX |
The above mentioned is the concept, that is elucidated in detail about ‘What are Non-Current assets?’ for the Commerce students. To know more, stay tuned to BYJU’S.
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