Active Asset

An active asset is an asset in the business or a firm that is used on regular biases and is used as an active part of a business operation. Active asset is a routine part of the business activities and without this asset a business may experience halt in its everyday activities. There are two types of active assets.

Tangible Active Assets

Intangible Active Assets

Tangible Active Assets

These are the assets that have a physical presence or an existence and used as a daily routine part of the business activities. The examples of these assets include buildings, computer and other electrical equipments, machinery, vehicles and other physically present things.

Intangible Assets

These are the assets that do not exist physically but still they are the part of routine business activities. These assets are used as a routine part in business operations of a company such as deals, legal agreements, documents etc. The examples of intangible assets include patents, copyrights, logos, brand names and trademarks.

Active assets play an important part in accomplishing daily activities of a business. Without active assets a business may lack in performance of its daily operations. The opposite of active assets are those called passive assets and these are the assets that are not required by the business on daily biases. Another term similar to active asset is the active asset allocation that must not be confused with active assets as it is a term that is used for investment strategies.

Other Related Accounting Articles:

• Intangible Assets
• Knowledge Economy
• Book Value
• Permanent Current Assets
• Book Value Explained
• Activity Cost Driver
• Asset Retirement Obligation
• Tangible Common Equity
• Knowledge Capital
• Asset Purchase Process