Fixed assets

The phrase 'fixed assets' covers all assets that the business intends to keep for more than a year.

Fixed assetsare found at the top of a company balance sheet. The phrase covers all assets that the business intends to keep for more than a year. So these are operational assets, such as buildings, vehicles and machinery, rather than trading assets. Fixed assets can also be divided into 'tangible' (assets you can kick) and 'intangible' to cover other long-term assets, such as goodwill, patents and brands. Both types are written off against profits as they get used up or wear out. For tangibles, this is 'depreciation'; for intangibles, 'amortisation'. So if a firm buys a van for a salesman for £50,000, expected to make roughly equal amounts of revenue over five years, profits will be charged with £10,000 each year.

Recommended

Margin call
Glossary

Margin call

When an investor borrows to bet on markets, they put down a deposit known as “margin”.
2 Apr 2021
Resource curse
Glossary

Resource curse

The term “resource curse” refers to the observation that countries with abundant natural resources also tend to be less economically developed than th…
14 Jan 2021
Balance of payments
Glossary

Balance of payments

The balance of payments refers to the accounts that sum up a country's financial position relative to other countries.
8 Jan 2021
Yield-curve control
Glossary

Yield-curve control

Yield-curve control is when a central bank aims to control long-term interest rates by pledging to buy (or sell) as many long-term bonds as needed to …
25 Dec 2020

Most Popular

China owns a lot more gold than it’s letting on – and here’s why
Gold

China owns a lot more gold than it’s letting on – and here’s why

In a world awash with money-printing, a currency backed by gold would have great credibility. And China – with designs on the yuan becoming the world’…
21 Apr 2021
“Joke” cryptocurrency dogecoin goes to the moon. What’s going on?
Bitcoin

“Joke” cryptocurrency dogecoin goes to the moon. What’s going on?

Dogecoin – a cryptocurrency created as a joke – has risen by more than 9,000% this year alone. Saloni Sardana looks at how something that began as an …
19 Apr 2021
House prices in the UK are still surging – here’s why it’ll probably continue
Property

House prices in the UK are still surging – here’s why it’ll probably continue

The latest UK house price data shows no letup in the country’s booming property market, with the biggest yearly rise since 2014. And there’s no end in…
22 Apr 2021