Property, plant, and equipment (PP&E) is a category on a company's balance sheet that includes tangible assets such as land, buildings, machinery, equipment, vehicles, and furniture. These assets are used in the production and operation of a business and are expected to be held for a long period of time.
PP&E is typically recorded on the balance sheet at historical cost, which includes the purchase price of the asset as well as any related expenses such as installation or delivery costs. Once recorded, the asset is depreciated over its useful life, meaning that a portion of its cost is expensed each year to reflect the asset's decreasing value over time.
PP&E is an important component of a company's financial statements as it represents significant investments in fixed assets that are essential to the company's operations. Investors and analysts often look at changes in a company's PP&E over time to gauge its growth and future prospects.
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