A modern enterprise must take into account many different points. If the structure is small, then everything can be kept in mind by its leader. But if there are many bosses, supervisors and other people, then they need to have an idea of the current situation. And accounting helps them in this. In this regard, the following question is relevant for accountants: what relates to tangible non-current assets (MBAs)? We will look for an answer to it.
general information
Let's start with the terminology. Non-current tangible assets are the property of an enterprise that is used repeatedly and during this process transfers parts of its property to products. In practice, this includes everything that has been used for more than one year and its value exceeds fifteen non-taxable minimum incomes of the enterprise.
More specifically, tangible non-current assets are:
- equipment and machinery;
- fixed assets;
- incomplete capital investments (investments);
- other tangible non-current assets.
This is an incomplete list due to the large number of possible physical manifestations. In operating activities, material non-current assets have a number of advantages and disadvantages. Let's look at them in more detail.
Advantages
Speaking of tangible non-current assets, it should be noted:
- virtually no exposure to inflation, so they are protected from its influence;
- have a small commercial risk of losses in operating activities;
- can bring stable profits, produce various products, depending on market conditions;
- contribute to reducing losses during storage of inventory items;
- expand the volume of production activity when the market conditions rise, thanks to the created reserves.
disadvantages
But, alas, not without negative aspects. Among them should be mentioned:
- Non-current tangible assets are property subject to obsolescence. Therefore, it loses its value even with a simple one.
- They are difficult to manage because their structure cannot be changed. Even when there is a decline in the market, the period of their use is reduced.
- Most often they are low liquid assets, because of which they cannot act as means of payment.
Balance display
Two points are conditionally distinguished here. So, tangible non-current assets in the balance sheet of a small enterprise are displayed using a simplified form, which is provided in Appendix No. 5 to the order of the Ministry of Finance No. 66n. All others work according to the general established requirements.
You need to know that tangible non-current assets in the balance sheet of a small enterprise, as well as all other economic entities, always belong to one milestone. Which one? Exclusively to the asset, as you might guess from the name. But at the same time, the totals should match the loan and debit. That is, it is necessary not only to correctly attribute it, but also correctly display it. If we talk specifically about tangible non-current assets, then accounts 1600 and 1700 must coincide in the end. If this is not so, then somewhere an error crept in. Although other accounts are used during the work, for example 1150. Tangible non-current assets, despite the difficulties encountered, must be calculated correctly in order to avoid various negative consequences.
Balance sheet specificity
Now let's talk about certain points.What is included in the balance sheet? Tangible fixed assets, or rather credit and debit. How and why? Let's look at tangible non-current assets in the balance sheet of a small enterprise. There is a registered capital of one million rubles. He buys equipment. They work on it, and there is a process of transferring value to manufactured goods. Thus, material non-current assets are paid off. The code of the line depends on the type: fixed assets go one at a time, machines go one second, and so on.
But this is not all individual points. So, the 1150th line of the balance sheet “Material non-current assets”, which was already mentioned in passing earlier, serves to combine a number of data. Therefore, while there is no certainty regarding the use of the structure or work is underway, everything can be attributed there. The main thing is that everything should coincide by 1150. What are tangible non-current assets from an accounting point of view? The line that is used must always match the credit and debit. Remember this.
About the classification, put in a word
Let's look at what MBA is from different points of view. So, there are functional types:
- Fixed assets. These are MBA enterprises, expressed in the form of labor tools, which are reused and gradually transfer their value to the created products.
- Incomplete capital investments (investments). This implies the amount of costs that was actually spent on the construction and installation of fixed assets until they were put into operation.
- Machines and equipment are necessary for the production of products. These include measuring equipment and other devices.
- Other types of non-current assets.
Also, the division can be carried out on the basis of the type of activity, where it is used:
- Operating. These are tangible non-current assets that are used in the economic activity of the subject.
- Investment. They mean long-term non-current assets that were formed as a result of investments in the company with the aim of making more profit in the future.
- Non-production. Needed to meet the social needs of staff. An example is a relaxation room or dining room.
About fixed assets
Speaking about what are tangible fixed assets in the balance sheet of the enterprise, it is difficult to ignore what makes money. So, fixed assets are recognized as those that correspond to such conditions:
- necessary for the production of goods or the provision of services;
- the useful life exceeds one year;
- no further resale is foreseen;
- the object can be used in the future to generate income.
These include:
- machinery / equipment;
- buildings / structures;
- means of transport;
- computing devices;
- working and productive cattle;
- inventory;
- perennial plants and other objects.
When they are put into operation, their initial cost is estimated. In fact, it is the sum of actually incurred costs for their acquisition, delivery, manufacture, installation. It can be changed during the modernization, reconstruction and revaluation. For the latter option, the term replacement cost is introduced. But there are a number of other indicators. For example, residual value, which is the difference between the initial price and the depreciation accrued in the process of use. The final indicator is used to form a balance.
Market value should also be mentioned. This means the price that buyers are willing to pay for an asset in the market. Moreover, in accounting, the unit of fixed assets is an inventory object. And finally, it is worth mentioning the resale value.This is the price that is set by a special commission in case of bankruptcy of an enterprise or by decision of participants in the structure itself.
In more detail about the components of fixed assets
Although from an accounting point of view, as a rule, they more or less all go on one line, nevertheless, it is necessary to know the variety in order to correctly classify it. So, allocate:
- Building. They mean construction projects that are designed to create the necessary working, living or manufacturing conditions. Each building is considered separately. Allocate industrial buildings, retail premises (as a subspecies - places of public catering), healthcare and culture buildings, housing and communal services.
- Facilities. These are objects that are intended for production activities and at the same time are not associated with the change of objects of labor. These include oil wells, dams, roads, fountains, bridges, monuments.
- Cars and equipment. By this we mean working and power devices that are used to influence objects of labor and the production of thermal and electric energy. The first include machines, the second - turbines, transformers, mobile power plants.
- Measuring instruments. They mean laboratory devices.
- Computer Engineering. These are objects whose task is to automate processes through the use of special computer programs. These include various electronic computing equipment and other electrical equipment.
And what else relates to fixed assets?
Monumental components were listed. Now let's talk about smaller, but no less important components:
- Vehicles. Designed for moving and moving goods. These include automobile, air, rail, water, horse-drawn and on-farm transport. These are trucks and cars, dump trucks, buses, tanks, trailers, motorcycles, bicycles, carts and sledges.
- Instruments.
- Household and industrial equipment.
- Productive and working cattle. By this we mean adult animals.
- Perennial plants.
- Land. Exclusively those that are owned and used by the enterprise.
- Other fixed assets. These are communication systems, office equipment and more.
By degree, nature, place of use
Distinguish such non-current tangible assets:
- Acting - those that are in operation.
- Inactive - being in a state of conservation and not used.
- In reserve - they are in reserve and are used to continuously ensure production work.
- Refined, reconstructed, liquidated.
- Production - take part in the creation of goods.
- Non-production - do not participate in the creation of goods, but without them this process is not possible.
About capital investments
They deserve mention too. Their second name is investment. In essence, they represent capital investments that are made in order to generate income. There are three types of investments, but we are only interested in those that are aimed at tangible non-current assets. These are the costs that go towards the acquisition of fixed assets, their updating or production. These include the construction and reconstruction of structures and buildings.
Also, capital investments include the manufacture and purchase of fixed assets (the cost of their transportation is taken into account), expenses on the formation of a herd and the cultivation of perennial plants. At the same time, investments can be made by contracting and / or economic means. The first involves the involvement of third-party specialists and / or organizational structures. The economic method assumes that the work will be done on its own.By the way, capital investments can be made for the subsequent transfer of fixed assets for rent or for rent. The income in this case will be the payment received.
Conclusion
That's all there is to know about tangible non-current assets. This will allow you to navigate the topic, but to become a professional, you need to work with practical material. Alas, even the most advanced theoretical knowledge is not enough to succeed. It is not enough to have information, it must also be used.