In accounting and finance, “outward” can refer to several things, but in the context of fixed assets, “Outward” refers to the process of sending the fixed assets from the company to another party with specific reason, such as a customer or another company. There can be several reasons why a company may choose to move its fixed assets outward:
- Sale: One of the most common reasons for moving fixed assets outward is to sell them to another party. This may be because the company no longer needs the asset, or because it is upgrading to a newer or more efficient asset.
- Disposal: If a fixed asset is no longer functional or cannot be repaired, it may need to be disposed of. Moving the asset outward in this case means transferring it to a third party who can handle the disposal process.
- Donation: A company may choose to donate a fixed asset to a charitable organization or a non-profit entity as a goodwill gesture. In this case, the asset is moved outward by transferring ownership to the recipient.
- Lease: If a company owns a fixed asset but does not need it for its operations, it may choose to lease the asset to another party. This involves moving the asset outward by transferring temporary ownership to the lessee.
Overall, the decision to move fixed assets outward is based on the specific needs and circumstances of the company, and requires careful consideration of the potential benefits and risks involved.