What does net income from fixed assets mean, and can you give an example?

Simply put, you buy a bike.

N years later, the car broke down to the point where it could no longer be repaired. You sold him to the scrap yard.

The money from the sale can be approximated as the net income from fixed assets.

If the enterprise handles the scrapping of fixed assets by itself, it will be transferred out first

Debit: Disposal of fixed assets (net part).

Debit: Accumulated depreciation (the part that has been withdrawn).

Credit: Fixed Assets (Original Value).

Expenses incurred during the clean-up process and taxes due

Borrow: Disposal of fixed assets.

Credit: Accounts such as bank deposits and taxes payable.

Recover the price of ** fixed assets, the value of residual materials, the income from the sale of goods, etc.:

Debit: Accounts such as bank deposits and materials.

Credit: Disposal of fixed assets.

The insurance company or the negligent person shall compensate for the loss

Debit: Other receivables and other accounts.

Credit: Disposal of fixed assets.

After the cleanup, if it is a net proceed:

Borrow: Disposal of fixed assets.

Credit: Non-operating income.

After the cleanup, if it is a net loss:

Borrow: Non-operating expenses.

Credit: Disposal of fixed assets.

In particular, it is emphasized that, according to the current regulations, property losses, including fixed assets, need to provide inventory information, and the pre-tax expenditure will be approved after being reviewed by the tax authorities (the national tax or local taxation bureau responsible for collecting enterprise income tax).

If the tax authorities do not agree to the pre-tax expenditure, they should make tax adjustments and increase the taxable income to levy enterprise income tax.

It's not the same. Net amount of fixed assets = book value of fixed assets = original price of fixed assets - accumulated depreciation accrued - provision for impairment of fixed assets = net value of fixed assets - provision for impairment of fixed assets.

The original or value of fixed assets should be recorded at the actual cost at the time of their acquisition. However, due to the different channels of fixed assets, the specific content of their value composition is also different. Net fixed assets = original value of fixed assets - accumulated depreciation.

This valuation method is mainly used to calculate the profit and loss, loss and loss of damaged fixed assets, etc.

Net income from disposal of fixed assets refers to the amount of income obtained by an enterprise from the disposal of fixed assets minus the book value of fixed assets and disposal expenses, which are transferred to non-operating income. During the period of production and operation, the income obtained from the liquidation of fixed assets of the enterprise shall be debited

Fixed Assets Disposal" account, Loan Pants: "Non-operating income - net income from disposal of fixed assets" account.

Specific accounting methods for net income from disposal of fixed assets:

1. After the transfer and loss of fixed assets, the gains or losses of fixed assets arising therefrom should be included in the profit and loss account of asset disposal. If a fixed asset incurs a net loss on disposal, the "Profit and Loss on Asset Disposal" account is debited and the "Fixed Asset Disposal Return" account is credited; If a fixed asset generates a net proceed, the Fixed Asset Disposal account is debited and the Asset Disposal Gain or Loss is credited to the Macro World Profile.

2. Damage to fixed assets caused by external natural disasters, or gains or losses caused by scrapping and liquidation. Both of these should be included in non-operating or non-operating expenses. If it is a net disposal loss arising from the normal scrapping and liquidation of fixed assets during the production and operation period of the enterprise, the "non-operating expenses - loss on disposal of non-current assets" account is debited and credited to the "Fixed Assets Disposal" account.

If the loss is caused by natural disasters during the production and operation period, the "Non-operating expenses - extraordinary losses" account is debited and the "Fixed Assets Disposal" account is credited; If it is a net income from fixed assets, the Fixed Assets Disposal account is debited and the Operating Income account is credited.

Net income from disposal of fixed assets refers to the amount of income obtained from the disposal of fixed assets after deducting the cost of disposal and the book value of fixed assets, which is transferred to the income from asset disposal.

For example, Company A is a general taxpayer of false value-added tax, on December 31, 2020, ** a building, the original price is 2,000,000 yuan, the depreciation has been 1,500,000 yuan, the impairment provision has not been made, the actual **** is 1,200,000 yuan, the VAT invoice has been issued, the tax amount is 108,000 yuan, and the price has been recovered through the bank. Company A should prepare the following accounting entries:

1) When transferring ** fixed assets to liquidation:

Borrow: Disposal of fixed assets - 500,000, accumulated depreciation - 1,500,000, Credit: fixed assets - 2,000,000.

2) When recovering the price of ** fixed assets:

Borrow: bank deposits - 1,308,000, credit: disposal of fixed assets - 1,200,000, taxes payable - VAT payable (output tax) - 108,000.

3) When carrying forward the profits realized by ** fixed assets:

Borrow: disposal of fixed assets - 700,000, credit: income on disposal of assets - gain on disposal of non-current assets - 700,000.

The net income from the disposal of fixed assets is non-operating income.

Net income from disposal of fixed assets refers to the amount of income obtained from the disposal of fixed assets after deducting disposal fees and fixed assets, and transferred to non-operating income. The income from the disposal of fixed assets is the income generated by the non-daily business activities of the enterprise, which is called profit. It is generally recorded as non-operating income.

Income refers to the formation of enterprises in their daily activities, which will lead to an increase in owners' equity, generally the operating income of the enterprise, and the liquidation of fixed assets refers to the scrapping and loss of fixed assets, as well as the liquidation of fixed assets that have been damaged and lost due to various force majeure natural disasters.

The conditions for revenue recognition are:

1. The enterprise has transferred all the main risks and rewards of commodity ownership to the buyer;

2. The enterprise neither retains the right to continue management that is usually associated with ownership, nor does it exercise control over the goods sold;

3. The amount of income can be reliably measured;

4. The relevant economic benefits are likely to flow into the enterprise;

5. The relevant costs that have been incurred or will be incurred can be reliably measured.

To sum up, revenue recognition is a logical judgment of whether revenue can be recognized and at what point or period after the conclusion of a business contract, while revenue measurement is a technical method issue for determining how much revenue is at each point or period. The enterprise should recognize revenue when it has fulfilled its performance obligations under the contract, i.e., when the customer obtains control of the relevant goods.

Legal basis]:

Article 10 of the Regulations on Financial Accounting Reports of Enterprises.

The income statement is a statement that reflects the operating results of an enterprise in a certain accounting period. The income statement shall be itemized according to the categories of income, expenses and items constituting profits. Among them, the definition and presentation of income, expenses and profits shall comply with the following provisions:

1) Income refers to the total inflow of economic benefits generated by an enterprise in its daily activities such as selling goods, providing labor services, and transferring the right to use assets. Revenue does not include payments collected on behalf of third parties or customers. On the income statement, income should be itemized according to its importance.

2) Expenses refer to the outflow of economic benefits incurred by enterprises in their daily activities such as selling goods and providing labor services. On the income statement, the expenses should be itemized according to their nature.

3) Profit refers to the operating results of the enterprise in a certain accounting period. On the income statement, the profit shall be listed separately according to the composition of the profit, such as operating profit, total profit and net profit.

**Net income from fixed assets is the amount of net income generated by the price obtained from the disposal of fixed assets exceeding the carrying amount of fixed assets. For example, the original value of fixed assets is 1 million, depreciation is 200,000, the book value of Youbutan Shentong is 800,000, and the disposal price is 810,000.