FAQ’s:
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What are assets?
A: Assets are resources with economic value owned or controlled by an individual, corporation, or country. They can be tangible (physical items like property, equipment) or intangible (such as patents, copyrights, trademarks).
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What is asset management?
A: Asset management involves the systematic process of developing, operating, maintaining, upgrading, and disposing of assets in the most cost-effective manner (particularly relevant in business contexts).
- How do you classify assets?
A: Assets can be classified in various ways, such as current assets (expected to be converted into cash within a year) and non-current assets (held for longer-term use). They can also be categorized as tangible or intangible, liquid or illiquid, etc.
- What is asset allocation?
A: Asset allocation refers to the strategy of spreading investments across various asset classes (like stocks, bonds, real estate) to optimize risk and return based on an individual’s goals, risk tolerance, and time horizon.
- How do you calculate asset depreciation?
A: Depreciation is the allocation of the cost of an asset over its useful life. Common methods include straight-line depreciation, declining balance depreciation, and units of production depreciation.
- What is asset tracking?
A: Asset tracking involves monitoring the location, status, and movement of physical assets using various technologies (like RFID, GPS) to improve operational efficiency and prevent loss or theft.
- What is asset liquidity?
A: Liquidity refers to how quickly an asset can be converted into cash without significantly affecting its price. Cash is the most liquid asset, while real estate tends to be less liquid.
- How do you calculate asset turnover ratio?
A: The asset turnover ratio measures a company’s efficiency in using its assets to generate revenue. It’s calculated by dividing net sales by average total assets.
- What are fixed assets?
A: Fixed assets, also known as property, plant, and equipment (PP&E), are long-term tangible assets used in the operation of a business. Examples include buildings, machinery, and vehicles.
- How do you manage digital assets?
A: Managing digital assets involves organizing, storing, and securing digital files (such as documents, images, videos, and software) to ensure easy access, usage rights, and protection against loss or unauthorized access.