Which of the following is not an example of property, plant, and equipment?Select one:a.Cash on handb.Vehiclesc.Trucksd.Buildings
Question
Which of the following is not an example of property, plant, and equipment?Select one:a.Cash on handb.Vehiclesc.Trucksd.Buildings
Solution
The correct answer is:
a. Cash on hand
Explanation:
Property, Plant, and Equipment (PP&E) are tangible items that are:
- Held for use in the production or supply of goods or services, for rental to others, or for administrative purposes, and
- Expected to be used during more than one period.
Examples of PP&E include land, buildings, machinery, vehicles, and office equipment.
Cash on hand, however, is not a tangible asset and is not used over multiple periods. It is a current asset because it can be used immediately to pay a company's current liabilities. Therefore, cash on hand does not fall under the category of Property, Plant, and Equipment.
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