Fixed assets are long-term physical assets that a company uses in its business. They are also known as capital assets or property, plant, and equipment (PP&E). Fixed assets are not expected to be converted to cash within the accounting year or operating cycle and usually have a life span of more than one year.

Some examples of fixed assets include land, buildings, machinery, vehicles, furniture, and office equipment. These assets are important to businesses because they help them generate revenue and profit. However, fixed assets also come with a certain amount of risk. For example, if a piece of machinery breaks down, it can be very costly to repair or replace it.

When accounting for fixed assets, businesses must carefully consider the costs associated with them. These costs can include the purchase price, shipping and installation costs, and other associated expenses. The accounting treatment of fixed assets can be complex, but it is important to correctly account for them in order to produce accurate financial statements.

Fixed assets are important to businesses because they help them generate revenue and profit. However, fixed assets also come with a certain amount of risk. For example, if a piece of machinery breaks down, it can be very costly to repair or replace it.

When accounting for fixed assets, businesses must carefully consider the costs associated with them. These costs can include the purchase price, shipping and installation costs, and other associated expenses. The accounting treatment of fixed assets can be complex, but it is important to correctly account for them in order to produce accurate financial statements.