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The corporation can then match the asset's cost with its long-term value.How a business depreciates an asset can cause its book value—the asset value that appears on the balance sheet—to differ from the current market value at which the asset could sell.The different categories of noncurrent assets include fixed assets, intangible assets, long-term investments, and deferred charges.
When a business is reporting persistently negative net cash flows for the purchase of fixed assets, this could be a strong indicator that the firm is in growth or investment mode.Fixed assets can include buildings, computer equipment, software, furniture, land, machinery, and vehicles.For example, if a company sells produce, the delivery trucks it owns and uses are fixed assets.Either way, the fixed asset is written off the balance sheet as it is no longer in use by the company. Because they provide long-term income, these assets are expensed differently than other items.Tangible assets are subject to periodic depreciation, as intangible assets are subject to amortization.
Meanwhile, long-term investments can include bond investments that will not be sold or mature within a year.