Equipment is not considered a current asset.
Instead, it is classified as a long-term asset.
If a business routinely engages in the purchase and sale of equipment, these items are instead classified as inventory, which is a current asset.
Is equipment an inventory?
Inventory. Inventory includes items that are used once or last only a short amount of time; these can also be referred to as consumables. These items do not need to be tracked closely like equipment, but knowing the quantity on hand is valuable to an organization so that they can be reordered when necessary.
Is rental equipment considered inventory?
The federal tax code treats rental inventory differently from retail inventory. With retail, you claim the cost of goods sold as a business expense. Rental inventory is a fixed asset, and you deduct it as depreciation.
Is inventory considered an asset?
Inventory assets are goods or items of value that a company plans to sell for profit. These items include any raw production materials, merchandise, and products that are either finished or unfinished. They are considered a part of your business assets. Basically, inventory assets are your saleable inventory.
What type of asset is equipment?
These are items of value that the organization has bought and will use for an extended period of time; fixed assets normally include items such as land and buildings, motor vehicles, furniture, office equipment, computers, fixtures and fittings, and plant and machinery.