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(Solved): 20) Explain the difference between current, fixed, and intangible assets. Give two examples of each ...
20) Explain the difference between current, fixed, and intangible assets. Give two examples of each of these different types of assets. 21) Explain the difference between a firm's formal organization and its informal organization. Why are both types of organization important to managers? 22) Explain the differences between managerial and financial accounting and give two examples for each of the types of problems and issues examined by each of these areas of accounting. 23) Explain the meaning of the fundamental accounting equation and its relation to the balance sheet. Create an example using numbers. 24) Explain the significance of "price" in a free-market economic system. 25) Explain why you agree or disagree with the following statement: "Marketing intermediaries must charge a high enough price for the functions they perform to earn a profit. Therefore, the cost of distributing goods can almost always be reduced by eliminating marketing intermediaries from the channel of distribution."
Expert Answer
Answer 20) Resources that a company owns and is expected to use in the future and have economic value are called assets. Current, fixed, and intangible assets are the three different categories of assets. Assets that can be converted into cash within a year or an operational cycle, whichever is longer, are considered current assets. Cash, receivables, inventories, and pre-paid expenses are a few examples of current assets.Assets that are expected to be employed by the company for a longer period of time are known as fixed assets. Fixed assets include things like land, buildings, machinery, and vehicles.Assets that do not have a physical presence but nonetheless have value to the company are known as intangible assets. The following are some examples of intangible assets: goodwill, copyrights, patents, and trademarks.