Financial Statements - I

( ) Fixed Assets: Fixed assets are those assets, which are held on a long-term basis in the business. Such assets are not acquired for the purpose of resale, e.g. land, building, plant and machinery, furniture and fixtures, etc. Some times the term ‘Fixed Block’ or ‘Block Capital’ is also used for them.

( ) Intangible Assets : These are such assets which cannot be seen or touched. Goodwill, Patents, Trademarks are some of the examples of intangible assets. ( ) Investments: Investments represent the funds invested in government securities, shares of a company, etc. They are shown at cost price.

If, on the date of preparation the balance sheet, the market price of investments is lower than the cost price, a footnote to that effect may be appended to the balance sheet. ( ) Long-term Liabilities : All liabilities other than the current liabilities are known as long-term liabilities. Such liabilities are usually payable after one year of the date of the balance sheet. The important items of long term liabilities are long-term loans from bank and other financial institutions.

( ) Capital: It is the excess of assets over liabilities due to outsiders. It represents the amount originally contributed by the proprietor/ partners