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Fixed assets (tangible assets) can be one of the largest asset groups within an organization and properly accounting for the assets, their maintenance, and disposal are critical for any business. Accounting rules for fixed assets address capitalization, asset retirement obligations, depreciation, impairment, and disposal. Fixed assets are not held for resale but for the production, supply, rental or administrative purposes. Assets that are held for resale must be accounted for as inventory rather than fixed assets. Other important components involve record keeping, controls, policies and procedures, measurements, asset tracking, and auditing procedures.

Inventory is anything the company stores. In a retail context, inventory refers to your raw material as well as the stock of finished goods or products that you sell. It is measured in units of stock as well as the value of the stock you hold. In the manufacturing industry, inventory is divided into three major types:

  • Raw material:  All material that will be used to produce a product
  • Work-in-progress/process: Parts manufactured but not yet assembled.
  • Finished product: Assembled product that that is ready for a sale. A typical retailer only holds this type of inventory.

Inventory Management is the science of purchasing, supervising, controlling and dispensing stock for sale stored in a facility. It covers all aspects of stock management across the supply chain from the manufacturer to the point of sale manned by the retailer. The process of inventory management begins with the initiation of a PO and ends when an order is fulfilled/ delivered.

This session will focus on important concepts bookkeepers should be prepared to manage/understand in relation to all the components of inventory and fixed assets. We will review concepts of fixed assets such as: depreciation, capitalization, disposal, inventory including the methods of managing and counting inventory as well as recordkeeping.

NOTE: This course is one of a series of courses developed for the Professional Bookkeeping Certification program on Illumeo. The full curriculum of courses will provide you with the ultimate foundation for a career as a bookkeeper.

Learning Objectives

  • Explore the definition of fixed assets.
  • Discover the capitalization of fixed asset costs.
  • Discover the various methods and types of depreciation for fixed assets.
  • Explore requirements for asset retirement.
  • Explore the definition of inventory and inventory key terms.
  • Explore the inventory process and inventory tracking.
  • Explore inventory management techniques.
  • Identify inventory count methods.
Last updated/reviewed: November 8, 2019

Included In Certifications

This course is included in the following Certification Programs:

14 CoursesProfessional Bookkeeping Certification

  1. Bookkeeping: Terminology and Process Execution
  2. Bookkeeping: Debits And Credits
  3. Bookkeeping: Cash vs. Accrual
  4. Bookkeeping: Payroll And Expenses
  5. Bookkeeping: Legal Entity And Chart Of Accounts
  6. Bookkeeping: Journals, Subsidiary Ledgers and General Ledger
  7. Bookkeeping: Responsibilities
  8. Bookkeeping: Fixed assets and inventory
  9. Bookkeeping: Accounts Payable/Accounts Receivable And Receipts
  10. Management Internal Control Essentials
  11. GAAP Principles, Assumptions and Considerations
  12. GAAP Presentation of Financial Statements
  13. Bookkeeping Basics – Case Study Scenario
  14. Useful Bookkeeping Tools

17 CoursesPROFESSIONAL BOOKKEEPING CERTIFICATION - THE VIRTUAL LIVE PROGRAM

  1. Bookkeeping: Terminology and Process Execution
  2. Bookkeeping: Legal Entity And Chart Of Accounts
  3. Bookkeeping: Responsibilities
  4. Management Internal Control Essentials
  5. GAAP Principles, Assumptions and Considerations
  6. Bookkeeping: Debits And Credits
  7. Bookkeeping: Cash vs. Accrual
  8. Bookkeeping: Payroll And Expenses
  9. Bookkeeping: Journals, Subsidiary Ledgers and General Ledger
  10. Bookkeeping: Fixed assets and inventory
  11. Bookkeeping: Accounts Payable/Accounts Receivable And Receipts
  12. GAAP Presentation of Financial Statements
  13. Bookkeeping Basics – Case Study Scenario
  14. Financial Statement Introduction
  15. Information Technology (IT) Risks in Emerging Business Environments
  16. Segregation of Duties for Core Business Processes
  17. Useful Bookkeeping Tools

11 Reviews (41 ratings)Reviews

4
Anonymous Author
I found it to be very informative and it will be a good asset to newly hired employees in these positions. I feel that it will get employees up to speed faster and more productive sooner. There is not a sufficient amount of time to complete at work with my busy work schedule. I had to complete this course at home on my own time.
5
Member's Profile
I like this course Lynn as content was more sophisticated in the bookkeeper's role. The explanations and examples of fixed assets VS. Inventory were spot on. Thank you, Larry
5
Member's Profile
The course was intense and provided the benchmark for understanding the basis of inventory management and fixed assets management, classification and depreciation
5
Member's Profile
This was a very good course on Fixed Assets and depreciation. I had some internet trouble but love the powerpoint slides
5
Member's Profile
WOW! this was a difficult one for me. A lot of information. The instructor is great I just think a lot to cover.
5
Member's Profile
I found this section to be very challenging. Depreciation is not one of my fondest things to learn.
5
Member's Profile
straight forward and easy to understand. good review of deprecation methods, but pretty basic.
5
Anonymous Author
This is a solid beginner level course that was useful as a refresher. Thanks!
5
Member's Profile
Good course.. still some things that I have to integrate... good examples
5
Anonymous Author
Thorough overview and good lecture with applicable examples.
5
Anonymous Author
Comprehensive and easy to follow along with and remember.

Prerequisites

Course Complexity: Intermediate

No Advanced Preparation or Prerequisites are needed for this course. However, it is recommended to take the other courses in the series prior to completing this one.

Education Provider Information

Company:
Illumeo, Inc., 75 East Santa Clara St., Suite 1215, San Jose, CA 95113
Contact:
For more information regarding this course, including complaint and cancellation policies, please contact our offices at (408) 400- 3993 or send an e-mail to .
Course Syllabus
INTRODUCTION AND OVERVIEW
  3:46Introduction to Bookkeeping Basics – Fixed Assets and Inventory
  6:18Defining Fixed Assets and Cost Capitalization
  6:33Fixed Asset Depreciation and Retirement
  6:54Depreciation Methods Part 1
  7:30Depreciation Methods Part 2
  11:13Depreciation Methods Part 3
  7:01Inventory
  11:36Inventory Process and Inventory Tracking
  2:33Inventory Management Techniques
  7:57Physical Inventory Methods
  1:10Summary
CONTINUOUS PLAY
  1:12:30Bookkeeping Basics – Fixed Assets and Inventory
SUPPORTING MATERIALS
  PDFSlides: Bookkeeping Basics – Fixed Assets and Inventory
  PDFBookkeeping Basics – Fixed Assets and Inventory Glossary/Index
REVIEW AND TEST
  quizREVIEW QUESTIONS
 examFINAL EXAM