Bedding working capital is the working capital required for purchasing raw materials, fuel, payment of salaries and other operating expenses, etc., during the commissioning phase of a project after its completion.
The cost of a fixed asset is all reasonable and necessary expenditures incurred to construct a fixed asset before it reaches its intended useable state. The cost of fixed assets should be included in the cost of fixed assets because the working capital is incurred during the commissioning stage, i.e., before the asset reaches its intended state of use.
Fixed assets refer to buildings, machines, machinery, buildings, means of transportation, and other equipment, tools, appliances, etc., related to production and operation, etc. Fixed assets in the broad sense of the term refers to all of the enterprise's current assets, including cash, inventory (materials, work in progress, and finished goods), accounts receivable, marketable securities, prepayments, and other items.
Expanded information:
Fixed asset disposal, including the sale, transfer, retirement and destruction of fixed assets, foreign investment, non-monetary asset exchanges, debt restructuring and so on.
I. Conditions for derecognition of fixed assets
Fixed assets shall be derecognized if they satisfy one of the following conditions:
(1) the fixed assets are in the state of disposal;
(2) the fixed assets are not expected to generate economic benefits through the use or disposal of the fixed assets.
II. Treatment of Fixed Asset Disposals
(1) Fixed assets held for sale by an enterprise shall be adjusted for their estimated net residual value.
(2) When an enterprise sells, transfers, or scraps fixed assets or incurs damage to fixed assets, it should recognize the proceeds of disposal, less the book value and related taxes, in the current period's profit or loss. The book value of a fixed asset is the amount after the cost of the fixed asset is deducted from accumulated depreciation and accumulated impairment allowance.
(3) Where an enterprise includes in the cost of fixed assets subsequent expenditure incurred on fixed assets, it shall derecognize the carrying value of the replaced part.
Baidu Encyclopedia-Fixed Assets