Which item is a fixed asset?

Which item is a fixed asset?

• A. Buildings
• B. Accounts Payable
• C. Short-Term Notes
• D. Taxes Payable

Answer: (A)

Fixed assets are long-lived tangible assets that a business uses in its operations and expects to keep for more than one year. They are typically depreciated over their useful life. Buildings are a classic example because they are physical structures used to run the business for many years. The other items are liabilities or obligations rather than assets: accounts payable is what the company owes to suppliers, short-term notes payable are borrowings due within a year, and taxes payable is what’s owed to the government. Those are not assets, so a building is the item that qualifies as a fixed asset.

Fixed assets are long-lived tangible assets that a business uses in its operations and expects to keep for more than one year. They are typically depreciated over their useful life. Buildings are a classic example because they are physical structures used to run the business for many years. The other items are liabilities or obligations rather than assets: accounts payable is what the company owes to suppliers, short-term notes payable are borrowings due within a year, and taxes payable is what’s owed to the government. Those are not assets, so a building is the item that qualifies as a fixed asset.