What are the classifications for long lived assets. Explain each.

What are the classifications for long lived assets. Explain each.



Long-lived assets are classified as follows:
(1) Tangible long-lived assets—assets that are tangible (i.e., have physical substance) and long-lived (i.e., beyond one year); they are acquired for use in the operation of a business and are not intended for resale. They are comprised of three different kinds of assets:
(a) Land—not subject to depreciation.
(b) Plant and equipment—subject to depreciation.
(c) Natural resources—mines, gravel pits, and timber tracts. Natural resources are subject to depletion.


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