wasting asset

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Related to Wasting Assets: Contingent Assets

Wasting asset

An asset that has a limited life and thus decreases in value (depreciates) over time. Also applies to consumed assets, such as oil or gas, and termed "depletion."

Wasting Asset

An asset, especially a derivative, that loses value over time. A primary example is an out of the money option, which declines in value close to the expiry date because it becomes less likely that the option will become in the money. It can also apply to assets that are consumed, such as oil or food products. In this situation, the asset reaches its highest value at its sale, and then rapidly depreciates. In accounting, a wasting asset is anything subject to depreciation. See also: Absolute physical life.

wasting asset

An asset that tends to decline in value over time as its expected life is used up. A factory machine or an automobile is a wasting asset. Some individuals also consider options or warrants wasting assets because they have a limited life after which they are valueless. Also called shrinking asset.

Wall Street Words: An A to Z Guide to Investment Terms for Today's Investor by David L. Scott. Copyright © 2003 by Houghton Mifflin Company. Published by Houghton Mifflin Company. All rights reserved. All rights reserved.

wasting asset

FIXED ASSETS such as mines, quarries and oil wells, which are used up during their working lives. It is especially important to make adequate provision for DEPRECIATION of such assets.

wasting asset

any NATURAL RESOURCE, such as coal and oil, that has a finite but indeterminate life span depending upon the rate of depletion. See ASSET.

Collins Dictionary of Economics, 4th ed. © C. Pass, B. Lowes, L. Davies 2005

wasting asset

An asset that is depleted or used up over time,such as oil and gas,minerals under the earth,or timberland.Wasting assets may give rise to income tax depletion deductions,similar to the better-known depreciation deductions.

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References in periodicals archive ?

It is natural to assume that recovery of the initial investment by the end of the property holding period would be rational and economically justifiable behavior on the part of investors dealing with wasting assets. By what capital recovery premise should they be guided?

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Thus many, if not all, of the military's current and projected assets are inappropriate for tomorrow's battlefields--and as such they are "wasting assets."

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A valuation may be required to determine a proper value for the stock of the company and the hypothetical allocation of purchase price to the various wasting assets under the seven asset classes, using the methodology of section 338.

Post-ownership change treatment of built-in gains and losses

481(a) income adjustments) were distinguishable from income from wasting assets such as the taxpayer's patient base.

Wasting assets do not generate BIG under Sec. 382. (Gains & Losses)

But winning Lottery tickets are wasting assets, even for experts, because claims are invalid after six months.

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(b) Wasting Assets. The LDR trigger is a "disposition" of an asset with a built-in gain.

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* Avoid gifting "wasting assets." Wasting assets will decrease in value in the future (via depreciation, amortization, or depletion), but are valued for gift tax at their present, higher value (oil, gas, mineral properties, patents, etc.).

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Many financial professionals refer to these as "wasting assets," because as soon as you purchase them, they begin to decrease in value.

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As a result, a real estate company's assets are reported as if they are wasting assets. Instead, information about changes (both decreases and increases) in their revenue-generating capacity is more relevant to users.

Current value reporting for real estate: an industry perspective

Navy plenty of usable Falklands-style power for limited battles using conventional weapons without wasting assets on big, strategic nuclear scenarios against the Soviets in which naval air power no longer makes much sense.

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Since HMRC classifies old cars as wasting assets, the PS16.6million profit was tax-free.

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Wise states, "It is important to have the separate values for the parts, because the income residual technique requires an estimate of both the required return on the real estate and the return of the wasting assets (i.e., the surface improvements) over their remaining economic life" This statement is tied to the particular method that he uses to estimate the capitalization rate for the surface improvements.