asset

Asset

Any possession that has value in an exchange.

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asset

Something of monetary value that is owned by a firm or an individual. Assets are listed on a firm's balance sheet and include tangible items such as inventories, equipment, and real estate as well as intangible items such as property rights or goodwill. Compare liability. See also current asset, intangible asset, tangible asset.

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Asset. Assets are everything you own that has any monetary value, plus any money you are owed.

They include money in bank accounts, stocks, bonds, mutual funds, equity in real estate, the value of your life insurance policy, and any personal property that people would pay to own.

When you figure your net worth, you subtract the amount you owe, or your liabilities, from your assets. Similarly, a company's assets include the value of its physical plant, its inventory, and less tangible elements, such as its reputation.

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asset

Something of value. On a balance sheet or personal financial statement, assets will include the following items, typically arranged in order according to the ease with which they can be converted into cash:

Cash and equivalents

Cash on hand:
Cash in banks
Marketable securities

Receivables:
Accounts receivable
Less reserves for bad debts

Furniture, fixtures, and equipment

Fine art

Real property

General intangibles:
Stock in closely held corporations
Intellectual property rights
Goodwill

When lenders examine balance sheets,they generally assume that individuals and small businesses overvalue the furniture, fixtures, and equipment and the general intangibles. Large entries for cash and equivalent assets will overcome a poor credit rating 9 times out of 10.

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Asset

What Does Asset Mean?

(1) A resource with economic value that an individual, corporation, or country owns or controls with the expectation that it will provide future benefit. (2) A balance sheet item that reflects what a firm owns.

Investopedia explains Asset

(1) Assets are purchased to increase the value of a firm. One should think of an asset as something that can generate cash flow. It could be a company's plant and equipment or an individual's rental property. (2) In the context of accounting, assets are either current or fixed (noncurrent). Current means within one year: cash, accounts receivable, and inventory. Fixed assets are expected to provide benefits beyond one year: manufacturing equipment, buildings, and real estate.

Related Terms:
• Balance Sheet
• Current Assets
• Depreciation
• Intangible Asset
• Tangible Asset

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Asset

An item of useful or valuable property.