Accounting Standards for Enterprises No.4-Fixed Assets
Article 21 If a fixed asset meets one of the following conditions, it shall be derecognized:
(1) The fixed asset is in a disposal state.
(2) The fixed assets are not expected to generate economic benefits through use or disposal.
article 22 an enterprise holding fixed assets for sale shall adjust its estimated net salvage value.
article 23 when an enterprise sells, transfers, scrapped or damaged its fixed assets, the amount of the disposal income after deducting the book value and relevant taxes and fees shall be included in the current profits and losses. The book value of fixed assets is the amount after deducting accumulated depreciation and accumulated impairment reserve from the cost of fixed assets.
losses caused by inventory losses of fixed assets shall be included in current profits and losses.
article 24 if an enterprise counts the subsequent expenditure of fixed assets into the cost of fixed assets according to the provisions of article 6 of these standards, it shall stop recognizing the book value of the replaced part.
Extended information
Accounting Standards for Enterprises No.4-Fixed Assets
Article 14 An enterprise shall accrue depreciation for all fixed assets. However, the fixed assets that have been fully depreciated and continue to be used and the land that is separately priced and accounted for are excluded.
depreciation refers to the systematic allocation of the accrued depreciation amount within the service life of fixed assets according to a certain method.
Accrued depreciation refers to the amount after deducting the estimated net salvage value from the original price of fixed assets that should be depreciated. For fixed assets for which impairment provision has been made, the accumulated amount of impairment provision for fixed assets shall also be deducted.
Estimated net salvage value refers to the amount that an enterprise currently obtains from the disposal of a fixed asset after deducting the estimated disposal expenses, assuming that the expected service life of the fixed asset has expired and is in the expected state at the end of the service life.
article 15 an enterprise shall reasonably determine the service life and estimated net salvage value of fixed assets according to their nature and usage.
once the service life and estimated net residual value of fixed assets are determined, they shall not be changed at will. However, unless it meets the provisions of Article 19 of these Standards.
Article 16 An enterprise shall consider the following factors when determining the service life of fixed assets:
(1) Estimated production capacity or physical output;
(2) Estimated tangible and intangible losses;
(3) restrictions on the use of assets by laws or similar provisions.
article 17 an enterprise shall reasonably choose the depreciation method of fixed assets according to the expected realization mode of economic benefits related to fixed assets.
The depreciation methods that can be selected include life average method, workload method, double declining balance method and sum of years method.
once the depreciation method of fixed assets is determined, it shall not be changed at will. However, unless it meets the provisions of Article 19 of these Standards.
article 18 fixed assets shall be depreciated on a monthly basis, and shall be included in the cost of related assets or current profits and losses according to their purposes.
article 19 an enterprise shall review the service life, estimated net salvage value and depreciation method of fixed assets at least at the end of each year.
if the estimated service life is different from the original estimate, the service life of fixed assets shall be adjusted.
if the estimated net salvage value is different from the original estimate, the estimated net salvage value shall be adjusted.
if the expected realization mode of economic benefits related to fixed assets is significantly changed, the depreciation method of fixed assets should be changed.
changes in the service life, estimated net salvage value and depreciation method of fixed assets should be regarded as changes in accounting estimates.
Baidu Encyclopedia-Accounting Standards for Business Enterprises No.4-Fixed Assets