Tangible Assets
These physical assets can be touched and readily converted to cash. They include vehicles, office equipment, buildings and machinery that depreciate over time but remain highly liquid.
Intangible Assets
Assets without physical form that add intrinsic value to the business, such as industry knowledge, name recognition, company know-how and goodwill. These aren't listed on balance sheets but are crucial to protect.
Intellectual Property
These non-physical assets receive legal protection through copyright law. They encompass patents, industry logos, brand names, trademarks, formulas, innovations and other creative communication.
Business Asset Valuation
Assets are valued using fair-market-value methods. An appraiser determines worth when assets serve as loan collateral. In bankruptcy, liquidation values typically fall below market value.
Asset Depreciation
Regular business use reduces asset value over time, particularly for machinery, vehicles and equipment. Depreciation is recorded as an expense on balance sheets.
Using Assets as Collateral
Pledging business assets as security can lower interest rates and improve borrowing terms. However, lenders gain rights to sell the asset if loan repayment defaults occur.
Asset Management
Maintain organised records including purchase dates, costs, depreciation, maintenance and salvage values. Protect tangible assets through insurance and physical management; register intellectual property with relevant offices.
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