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Simple English definitions for legal terms
wasting asset
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A quick definition of wasting asset:
A wasting asset is something that you own that loses value over time. This could be something like a car or a computer that becomes less valuable as it gets older and is used more. Assets are things that you own that have value, like money or property. They can be used to pay off debts or distributed to others. A current asset is something that can be easily turned into cash, like a savings account or stocks. A fixed asset is something that is used to run a business, like equipment or land.
A more thorough explanation:
A wasting asset is an item that is owned and has value but loses value over time. This can include assets such as machinery, vehicles, and buildings that depreciate in value as they age or wear out.
For example, a company's fleet of delivery trucks is a wasting asset because their value decreases as they accumulate mileage and require maintenance. Similarly, a piece of real estate located in an area with declining property values is also a wasting asset.
Wasting assets are important to consider when valuing a company or individual's assets, as they may not be worth as much as they were originally purchased for.