Types of Assets in Tally Accounting

Meaning of Assets in tally Accounting

when we do the accounting of any company or firm, we hear the name of assets. So what are these assets and how many types are they? Many people know what assets are, but they do not know how many types they are, and which assets come in which group.

In this post, I will tell you in very simple words what are assets, how many types they are, and which assets come in which group.

 Friends, any such item from which economy benefits can be obtained in the future, such as cash, cars, furniture, buildings, animals, land, computers, chairs, patents, factories, investments, etc., all of them are called assets.

Types of Assets in Tally

1. Current assets (short term assets)

2. Fixed assets (long term assets)

Current Assets: – current assets are called all those assets, which can be converted into cash in 1 year, and which gives profit for a short time.

 Such as:- cash, short term investment, account receivables (sundry debtor) inventory, etc. All such assets come in it which can be converted into cash in a year.fixed assets include all those assets which will benefit the business for a long time.

Example of Fixed Assets in tally

1. Buildings
2. Lands
3. Furniture
4. Vehicles
5. Cars
6. Bike
7. Machinery
8. Computer & Printers
9. Factories
10. Equipment

Example of Current Assets in Tally

1. Cash in Hand
2. Cash in Bank
3. Sundry Debtors
4. Stock
5. Bills Receivable
6. Prepaid Expenses
7. Income Earned but not received
8. Short – turm Investments
9. Short-turm loan & advance

But apart from these, there are other assets of any company or firm, which we cannot see or touch, and we call these assets as intangible assets.

Apart from these, there are other assets of any company or person which I am telling you below.

Example of Intangible assets

1.trade secrets

2. copyright

3. brands

4. patents

5. special right etc.

Apart from these, people have many types of animals, which we will also call assets.

Like;

1. Horse
2. Elephant
3. Goat all these are also assets.

When the Balance Sheet of a company or an individual is prepared, it includes all the assets and Liabilities of the company, which gives the real position of the company, it becomes clear if the company has more assets and less liabilities. company is in profit

Difference between Fixed Asset and Current Assets

In any business there is both fixed asset and current asset but in both is divided by time and commodities. Where fixed asset can be in any business like computer, laptop, furniture, land, cars, bikes, buses, etc. On the other hand, in the current assets, all those assets come which can be converted into cash by a businessman at any time, it includes stock in hand, cash, bank, debtors, shares. Fixed asset plays its role in any business for a long time whereas current asset is for a business only for one year.

Are Prepaid Expenses an asset?

Prepaid expenses are always the current assets for a company’s business. Prepaid expenses are those expenses which have already been paid by a merchant before availing the services. Let me explain you with the example of rent. A company that has taken office on rent and if that company makes advance payment of three months rent, then such expenses will be called prepaid expenses because it has been given by the company ahead of time. Prepaid expenses are the current assets of the company which are shown in the balance sheet of the company.

What are the difference between prepaid expenses and outstanding expenses

The prepaid expenses and outstanding expenses are shown in the balance sheet of the company. Prepaid expenses are the current assets for a company while outstanding expenses are the liabilities for the company. Prepaid expenses and outstanding expenses are shown in the balance sheet but they are opposite to each other where prepaid expenses are the expenses paid ahead of time whereas outstanding expenses are the debt to a company which it has to pay in the current year. Both of these are important in any business, but assets show the assets of a company while liability is the debt on the company.