SAP Financial Accounting (SAP FI) Practice Exam

What are fixed assets in the context of SAP?

1. Resources the company uses day to day

2. Inventory items for sale

3. Temporary investments

4. Non-operational goods

The correct answer is: Resources the company uses day to day

Fixed assets in the context of SAP refer to long-term tangible and intangible assets that a company utilizes in its operations to generate revenue over a period of time. These assets are not intended for resale and are crucial for a company's ongoing operations. They can include items such as machinery, buildings, vehicles, and land, which are used to produce goods or provide services. Fixed assets are characterized by their longevity, as they usually have a useful life extending beyond one accounting period. The classification of fixed assets is important for financial reporting, as they are recorded on the balance sheet and depreciated over time, reflecting wear and tear or obsolescence. Understanding fixed assets helps businesses manage their resources effectively and impacts their financial statements significantly. In contrast, inventory items for sale are categorized as current assets and are intended for resale within a short period, while temporary investments typically involve cash equivalents or short-term financial instruments. Non-operational goods are items not actively used in the company’s day-to-day operations, which would also not fit into the definition of fixed assets.