Intangible assets usually refer to identifiable non monetary assets that are owned or controlled by an enterprise and have no physical form. When an enterprise cleans up intangible assets, what about the relevant accounting entries?
Accounting entries for the liquidation of intangible assets
Debit: bank deposit (according to the amount actually received)
Accumulated amortization (based on accrued accumulated amortization)
Provision for impairment of intangible assets (based on the provision for impairment withdrawn)
Non operating expenses - loss on disposal of non current assets (by debit difference)
Credit: intangible assets (according to the book balance of intangible assets)
Tax payable - VAT payable (output tax)
Non operating income - gains from disposal of non current assets (by credit balance)
What are intangible assets?
Intangible assets refer to identifiable non monetary assets without physical form that are owned or controlled by an enterprise. If an asset meets one of the following conditions, it meets the identifiability standard in the definition of intangible assets: it can be separated or divided from the enterprise, and can also be used alone or together with related contracts, assets or liabilities for purchase, sale, transfer, licensing, etc.
What is cumulative amortization?
Accumulated amortization is used to amortize intangible assets. The balance is generally in the credit, and the credit registers the accrued accumulated amortization. Similar to the cumulative depreciation account in fixed assets. The cumulative amortization account is an asset type account, which is used to calculate the amortization of intangible assets. Listed in the assets in the balance sheet as a deduction of intangible assets. Accumulated amortization only belongs to the adjustment account of intangible assets, and the registration direction is opposite to that of intangible assets.
What is non operating income?
Non operating income Non operating income refers to various gains that are not directly related to the daily business activities of an enterprise. It is an integral part of an enterprise's financial results. For example, confiscating the deposit income of packaging materials, recovering the arrears of transferred employees, and the net income of fines.
Accounting entries for clearing of intangible assets
The accounting entry of intangible asset disposal needs to determine whether the disposal profit or loss is included in non operating income and expenditure or asset disposal profit or loss according to whether the intangible asset still has use value. If the asset still has use value, the received disposal price is included in the bank deposit. At the same time, the accumulated amortization of the intangible asset is written off. The original value of the credit intangible asset is included in the asset disposal profit or loss, and the difference is included in the asset disposal profit or loss. If the asset has no use value, the received disposal price shall be included in the bank deposit, and the accumulated amortization of intangible assets shall be written off. The original value of the credit intangible assets shall be included in the non operating income (credit difference) or non operating expenditure (debit difference).
How to make accounting entries when paying off debts with intangible assets
The payment of debts with intangible assets involves a patent right, which was originally recorded with provision for impairment
Debit: accounts payable - a company
Debit: non operating expenses - debt restructuring loss
Credit: intangible assets - a patent right
Credit: tax payable VAT payable Output tax
brief introduction
Accounting entries are also called "bookkeeping formulas". It is called "Entry" for short. According to the requirements of double entry bookkeeping principle, it lists the corresponding accounts of both parties and their amounts for each economic transaction. Before the account is registered, the accounting entry is prepared through the bookkeeping voucher, which can clearly reflect the classification of economic business, and is conducive to ensuring the correctness of account records and facilitating post inspection.
Each accounting entry mainly includes bookkeeping symbol, relevant account name, summary and amount. There are two kinds of accounting entries: simple entry and compound entry. Simple entry is also called "single entry". It refers to the accounting entry corresponding to the debit of one account and the credit of another account.
