Chapter 21
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14 terms
Terms | Definitions |
|---|---|
 current assets | Cash and other assets expected to be exchanged for cash or consumed within a year. |
| plant assets | Assets that will be used for a number of years in the operation of a business. |
| real property | Land and anything attached to the land. |
| personal property | All property not classified as real property. |
| assessed value | The value of the asset determined by tax authorities for the purpose of calculating taxes. |
| depreciation expense | The portion of a plant asset's cost that is tranferred to an expense account in each fiscal period during a plant asset's useful life. |
| estimated salvage value | The amount an owner expects to receive when a plant asset is removed from use. |
| straight-line method of depreciation | Charging an equal amount of depreciation expense for a plant asset in each year of useful life. |
| accumulated depreciation | The total amount of depreciation expense that has been recorded since the purchase of a plant asset. |
| book value of a plant asset | The original cost of a plant asset minus accumulated depreciation. |
| plant asset record | An accounting form on which a business records information about each plant asset. |
| gain on plant asset | Revenue that results when a plant asset is sold for more than book value. |
| loss on plant asset | The loss that results when a plant asset is sold for less than book value. |
| declining-balance method of depreciation | Multiplying the book value by a constant depreciation rate at the end of each fiscal period. |
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