Definition of asset in accounting

How to understand assets in accounting? what are the conditions to be fulfilled? recognize assets. tricky issues with assets.

1. Conditions need to be fulfilled to become an asset in accounting

2. Issues discussed Assets in common sense (to general people at large) Conditions to be fulfilled to become an asset in accounting Some tricky issues relating to recognition of assets in accounting examples

3. Elements of financial statements Asset Liabilities Capital/ Equity Income Expense

4. Assets in common sense Asset is something valuable on which we have ownership

5. Quiz 1 It is mandatory to have ………………………… the resources to become an assets in accounting. Ownership of Control over Physical existence of

6. Quiz 1 - Answer It is mandatory to have Control over the resources to become an assets in accounting. Ownership of …………………. Physical existence of

7. For video lecture (Bangla) https:// youtu.be/YWbN29KRuwA For video lecture (English) https:// youtu.be/rxXfgVCcr5M For other video lecture https:// www.youtube.com/channel/UC8SbYz1Kkyiw7hQGNJbgTKg

8. Lets see an e xample You have purchased a new phone and returning back to your home Suddenly you met with a big brother in the road And finally he took away your phone from you and it will never come back to you Now you have the phone ownership documents and the phone box with you, but not the phone

9. Control over the Asset Indication of having control # 1 If an entity has the present ability to direct the use of the asset and obtain the potential future economic benefits, it indicates that the entity has control over the asset.

10. Control over the Asset Indication of having control # 2 In other words, if the entity has the present ability to prevent other parties from directing the use of the asset, it is also an indication of having control over the asset.

11. Control over the Asset Indication of having control # 3 Having ownership of the asset is a good indication of having control over the asset. But ownership is not mandatory.

12. Potential Future economic benefits will flow to the entity An entity can recognize an asset, if the potential future economic benefits will flow to the entity. The potential future economic benefits may be obtained through: use of the asset for its own purpose receive contractual cash flows against the asset extinguish liabilities by transferring the asset.

13. Cost can reliably be measured This is actually very much fundamental. Because to become a transaction it should comply with money measurement concept . So to recognize an asset, an entity needs to know the cost of acquiring the asset.

14. Mandatory conditions need to be fulfilled to become assets in accounting Control on the assets by entity Potential future benefits will flow to the entity Cost can reliably be measured

15. Now come to the definition An asset is a economic resource controlled by the entity acquired as a result of the past events from which potential future economic benefits will flow to the entity . And the cost of the asset can reliably be measured.

16. Types Assets can be Non-current (long term) Current (short term) Assets can also be classified as: Tangible Intangible

17. Please