Asset facts for kids

Kids Encyclopedia Facts

In business and accounting, an asset is an economic resource that can be controlled by somebody (a person or an organization). They are made because of past transactions or events and they may help in getting future economic benefits.

Examples of assets include money, property (land and buildings), and amounts to be received from someone.

There are two types of assets:

  • tangible assets
    • Fixed assets such as buildings, equipment etc.
    • Current assets like inventory
  • Intangible assets e.g. goodwill, patents, trademarks, copyright, computer programs

Asset characteristics

Assets have three important characteristics:

  • They can give a future benefit to contribute directly or indirectly to future net cash flows, and, in the case of not-for-profit organizations, to give services;
  • It can control access to the benefit; and,
  • The transaction or event which created the asset has already occurred.

Asset Facts for Kids. Kiddle Encyclopedia.