The tooling is the set of tools and various utensils that support one or more activities within any type of action in the company.
In other words, we can use them both in ordinary business activities and in administrative operational activities.
Types of tooling in accounting
The tooling is part of the asset at the accounting level. Although it has a great variety, they can almost always be distinguished into 2 types:
- Quick renewal tooling. Examples of this type of tool would be pens, notebooks, diaries, staplers, etc.
- Slow renewal tooling. On the other hand, here we can include accessories such as a hammer, a spanner or a screwdriver.
We can classify both types of utensils or tools with the same accounting consideration, but with the only difference that one has the short-term factor, and the other has the medium / long-term factor in terms of renewal.
Examples of tooling in accounting
Given an acquisition situation, it would be carried out such that:
In addition, after each financial year, we must amortize the proportional value that touches it, depending on the criteria that we have established at the accounting level, such as linear amortization, by use, etc.
In this way, we can see that of the total value of € 100, we have theoretically put an expected useful life of 4 years, so if we divide € 100 of initial value between the estimated 4 years of use, the result is 25 € of technical impairment in the form of amortization.
In other words, at the beginning of the second year it will have a book value of € 75.