mapozi wrote:@Marty,wow. What you are doing will really make a difference. Now while at it, would you kindly give us examples of assets coz i think when you say asset the number one thing that comes to most peoples' minds are personal 'assets' e.g. Household items,or am I pre empting a later topic? Thanks
At mapozi let's look at assets:
Definition: Assets are economic resources (tangible or intangible) that are capable of being owned or controlled to produce value and that are held to have positive economic value. Simply stated, assets represent ownership of value that can be converted into cash (although cash itself is also considered an asset).
examples Intangible assets: copyrights, goodwill, , trademarks, softwares, patents etc
financial assets: stocks, accounts receivable, bonds etc
Current assets: liquid cash and its equivalents (currency, deposit accounts, and negotiable instruments like money orders, cheque, bank drafts), receivables, pre-paid expenses, inventory etc
Fixed: land, buildings, machinery, furniture, tools,equipment.
Now to the contentious issue: Your own house and the households therein are not for sale. And whenever you sell any of these, you'll most likely replace them with another. In essence you'll always have a house and household items all the time and they are not held for sale and they never generate income. Look at the house you live in, it actually consumes money to maintain and it does not generate money at all, and whenever you'll sell it, unless u plan to stay homeless you'll most liekly acquire one at market value then. This is very different from a unit you built for rental purposes.
In a nutshell an asset generates income periodically and / or will generate positive economic value at the point of disposal. so it could have the two attributes or at least one of them.
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