Whats is fictitious asset?

Fictitious assets are the assets which has no tangible existence, but are represented as actual cash expenditure. Expenses incurred in starting a business, goodwill, patents, trademarks, copy rights comes under expenses which cannot be placed any headings. Fictitious assets have no physical existence.

Is goodwill is a fictitious asset?

Fictitious assets have no tangible or physical existence and any realisable value, but they always represent actual cash expenditure, that is charged from the profit. Whereas, goodwill is not an expense and it takes time to build. That is why goodwill is not considered as a fictitious asset.

What are fictitious assets in balance sheet?

Fictitious assets can be defined as the assets that cannot be realised in cash or no further benefit can be derived from those assets. These assets include a debit balance of profit and loss A/c and the expenditure not yet written off such as advertising expenses etc.

What are the fictitious assets give some examples?

Some examples of fictitious assets are:

• Promotional Expenses.
• Preliminary Expenses.
• Discount on issue of shares.
• Discount/Loss on issue of debentures.

Which of the following is an example of fictitious assets?

Example of Fictitious Assets :- Major examples of fictitious asset are : profit and loss (dr. bal), discount on issue of shares and debentures, preliminary expenses, underwriting commission, advertisement suspense a/c etc.

Is bills receivable a fictitious assets?

Answer: Fictitious assets are not assets at all however they are shown as assets in the financial statements only for the time being. Promotional expenses, Preliminary expenses, Discount allowed on issue of shares and Loss incurred on issue of debentures are examples of fictitious assets.

What are fictitious assets give one example?

Fictitious assets are the deffered revenue expenditure as well as intangible assets i.e advertisement expenses, discount on issue of shares and debentures. But point to be remembered that Goodwill, Patents, Trade Marks are not the part of Fictitious assets.

Which assets are fictitious assets?

Is Depreciation a fictitious assets?

In the end, the fictitious assets will be zero, all expenses are recognized over the appropriate accounting period. The process is similar to the depreciation of the fixed assets, but again it is not the asset….Fictitious Assets Journal Entries.

Is prepaid expense a fictitious asset?

Prepaid expenses and fictitious assets are both of revenue nature. Prepaid expenses are expenses incurred in advance. These are spread over for more than one reporting period and hence are recorded as a non-current asset but these are not actually an asset and so they are treated as fictitious assets.

Is Depreciation a fictitious asset?

What are losses and fictitious assets?

Definition of Fictitious Assets Fictitious assets are the expenses or losses which are not fully written off (not offset in the Profit and Loss A/c) during particular accounting period. These expenses or losses are spread over more than one years.