Fixed Assets & Close

Fixed-asset accounting and the month-end close: depreciation, impairment, capitalization, useful life, roll-forwards, and the preparer-and-reviewer workflow.

Key terms & definitions

16 terms in this pack

ACCUMULATED

___ depreciation: the running total taken to date

ADDITION

A new asset capitalized during the period

CAPEX

Spend on long-lived assets that gets capitalized, not expensed (abbr.)

CAPITALIZE

To record a cost as an asset rather than an immediate expense

CLOSE

Month-end ___, the cycle you review for Fixed Assets

CONSTRUCTION

___ in progress (CIP): an asset not yet placed in service

DEPRECIATION

Spreading a fixed asset's cost across its useful life

DISPOSAL

Removing an asset from the books when retired or sold

IMPAIRMENT

Write-down when an asset's value falls below its carrying amount

INSERVICE

Placed ___: when an asset starts being depreciated

NETBOOK

___ value: cost minus accumulated depreciation

PREPARER

The role that builds a schedule before it is reviewed

REVIEWER

Your role on the Fixed Assets close, versus preparer

ROLLFORWARD

Schedule showing beginning balance, activity, and ending balance

SALVAGE

Estimated residual value at the end of an asset's life

USEFULLIFE

Period over which an asset is depreciated (two words)