Fixed Asset Accountant Career Guide and Counseling

Question: Have any other accountants moved to Raleigh from California? How is it out there? I am planning on moving from San Jose to Raleigh, and I was interested in finding out what other accountants had to say about the transition. I am a utility accountant, fixed assets to be exact, so has anyone else transitioned from Cali to Raleigh, if so how did you feel about it?

Answer: hope you like humidity.

Question: I need a comprehensive list of financial reports that a chief accountant is expected to prepare.? A chief accountant is expected to prepare or generate through system various financial reports in his routine on daily, weekly, monthly, quarterly and yearly basis. I need a list of those reports covering areas like sales, receivable, purchase, payable, fixed assets, financial statement, budget vs actual report, dashboard report.

Answer: Every business requires different reports to monitor their key variables. The major ones are the P/L statement, balance sheet, and cash flow statement.

Question: Differentiate between tangible and intangible fixed assets giving three examples of each? Briefly outline the problem for accountants in recognizing intangible assets in financial statements.

Answer: Tangible Fixed Assets: Freehold Buildings Leasehold Property Computer Equipment, Office Equipment, Company Vehicles Intangible Fixed Assets: Patents Intellectual Property Rights Goodwill It is very difficult to put a specific dollar amount on intangible items. What seems worth $100 to you may not be worth the same to others. For instance, a patent on a new pharmaceutical may seem futile at first but as the drug enters through various testing stages, that intangible patent seems worth much more on the balance sheet.

Question: Is it the best way of accounting if accountants show fix assets at original cost, less amount of depreciation? How would he come up with the amount of depreciation? What kind of assets can we use, both tangible and intangible?

Answer: Depreciation is always subjective as two identical assets could not depreciate in the some way along the time. What companies usually do are depreciating assets (both tangible or intangible) which are worth the cost of depreciation (you would not want to depreciation a rubbish bin, which would not value the cost of calculation its depreciation; however, you sure want to depreciate your company's buildings and trademarks, using a depreciation method which seems more suitable for you.). In general words it is like that.

Question: Accountants: Where to draw the line on fixed assets? Where should I draw the line on declaring an item a fixed asset? I have our vehicles, scissor lifts and excavators down as fixed assets, but should I also include power tools (e.g. band saws, drills, sawzalls, etc.)? As far as office equipment goes, I have declared computers, desks and filing cabinets, but what about other smaller items (e.g. desk organizers, calculators, label makers, etc.)?

Answer: You can include all your above mentioned items, but small tools and inexpensive items may be depreciated very fast, or charged off as a daily expense when purchased. These may be listed in the case of sale of a business, but a buyer may not place much value on some. Large equipment and power tools generally have a longer life, and in some cases, such as vehicles, the IRS does not permit accelerated depreciation. Some equipment depreciation has been allowed to be accelerated in recent years but that can change periodically. New tax policies must be reviewed every year. Desk organizers and/or office supplies/stationery should not be included. These are generally considered daily expenses. Again, in a sale situation, large quantities may be considered. I'm not an accountant, but am retired after 50 years in retail. An accountant may agree or disagree with me.

Question: fixed assets? can you list & depreciate fixed assets from prior years (2002) that were previously treated as an exprense? is there a benefit to it? i know nothing about taxes. ours are done by a professional accountant, but bookkeeping is done in house. while going through our records to see what has been donated, i found several (a LOT) of items that should have been listed, from professional reference books to furniture. most items were listed under supplies expense (office supplies) or training. the company is an LLC taxed as a partnership. also, a link or name of a site with a list of depreciable fixed assets would be great if anyone knows of one. that would help me weed this out a little. thanks!

Answer: If they were "expensed" in a prior year, you already received the tax benefit. DO NOT list them as assets to depreciate. You would be taking a deduction twice.

Question: Wilson Company purchases an asset with a useful life of 8 years which it plans to depreciate using the 200%? declining balance depreciation method. What annual depreciation rate will Wilson use? a) 12.5% b) 20% c) 25% d) 50% 2) I f the cost to improve a fixed asset is relatively small in comparison to the overall cost of the asset, what accounting constraint would allow the accountant to expense the cost of the improvement even when it extended the life of the asset? a) Matching b) Consistency c) Relevance d) Materiality 3) Which of the following is not a step for safeguarding an asset? a) A security guard working overnight in an office building b) The segregation of duties, especially in control and record keeping functions. c) Requiring a certain level of education for all employees. d) Backing up all computer data.

Answer: 1. c. The DDB rate is double the straight line rate. 2. d. To capitalize the cost, it would have to be material. 3. c. A worthy goal, but not related to securing assets.

Question: Did my accountant handle this the right way? I had purchased a vehicle for my business. After paying on it for a year, it was repurchased by the manufacturer because it was a lemon. The purchase price was $25000. After a year of payments, the payoff balance was $19000. The car was disposed of by the manfacturer and they paid of my loan. I had no net gain from this overall except for the reimbursement from interest from the bank which was a$200 check after everything was finalized. When my accountant ended my year he put this $19000 payoff as a "gain on sale of a fixed asset" causing me to show net income at the end of year. In other words I owed business income tax from the "sale" of the vehicle even though I never saw this money. I did not benefit from the sale because the manufacturer paid the vehicle off and took possession of it. Was this the correct way to do this? Should I consult another accountant? He got this return back to me a day before the tax was due so I had to send in the tax payment to not be late

Answer: Considering the citcumstances.. i would think that all you earned was the $200. thay money was used to payoffthe car .. i dont think that is right and i would question it.

Question: I need a software designer to help me get a program to market...any suggestions? This is a business software that takes a technical tax service and simplifies it for non-technical people. ANyone who owns income generating property can benefit form the service that the program provides. Accountants, Tax preparers and Fixed Asset managers will want this program

Answer: Where are you in the development processes? Do you need help with the application design, or the marketing, or in the distribution? What skills / experience / capital do you bring to the table?

Question: Question for Accountant !? 1.Land costing $88,000 was sold for $50,000 cash. The loss on the sale was reported on the income statement as other expense. On the statement of cash flows, what amount should be reported as an investing activity from the sale of land? a.$50,000 b.$88,000 c.$138,000 d.$38,000 2.Baxter Company reported a net loss of $13,000 for the year ended December 31, 2010. During the year, accounts receivable decreased $5,000, merchandise inventory increased $8,000, accounts payable increased by $10,000, and depreciation expense of $4,000 was recorded. During 2010, operating activities a.provided net cash of $8,000. b.provided net cash of $2,000. c.used net cash of $8,000. d.used net cash of $2,000. 3. Concerning the Indirect Statement of Cash Flows, select the correct statement. a.The management of a company would mostly utilize the Indirect Statement of Cash Flows as a management tool since it starts with Net Income from the Income Statement. b.The management of a company would not normally distribute the Indirect Statement of Cash Flows as a statement within its annual reports because it would most likely confuse the average reader. c.The management of a company would most likely distribute the Indirect Statement of Cash Flows as a statement within its annual reports because it starts with Net Income and ends in the current cash balance which increases reader confidence in the report. d.The management of a company would most likely distribute the Indirect Statement of Cash Flows as a statement within its annual reports because it does not present any relation to the other statements of the report; therefore it is least likely to confuse the reader. 4.Accounts receivable arising from sales to customers amounted to $40,000 and $31,000 at the beginning and end of the year, respectively. Income reported on the income statement for the year was $120,000. Exclusive of the effect of other adjustments, the cash flows from operating activities to be reported on the statement of cash flows is a.$120,000. b.$129,000. c.$151,000. d.$111,000. 5.Free cash flow is a.all cash in the bank b.cash from operations c.cash from financing, less cash used to purchase fixed assets to d.maintain productive capacity and cash used for dividends cash flow from operations, less cash used to purchase fixed assets to maintain productive capacity and cash used for dividends

Answer: 1. a) $50,000 2. d) used net cash of $2,000 3. c) 4. b) $129,000. 5. d)