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The Corporate Finance Institute Accounting
PPE Accounting
Background
To learn more, please Property, Plant, and Equipment, also referred to as PPE, are tangible
check out our free online items that are:
accounting courses
a. Held for use in the production or supply of goods or services; and
View courses b. Are expected to be used during more than one accounting period
First and foremost, PPE is classified as a tangible asset. Assets can be
separated into two kinds: tangible and intangible.
Tangible Intangible
Possesses a physical presence Does not have physical presence
Examples: Examples:
• Land • Copyright
• Building • Patents
• Equipment • License
• Production facility • Trademark
The accounting treatment for tangible and intangible assets is very
different. Here we focus on the accounting for tangible assets, mainly PPE.
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