Definitions for "Property, plant, and equipment"
A major classification on the balance sheet. It is the second long term asset section after current assets. Included are land, buildings, leasehold improvements, equipment, furniture, fixtures, delivery trucks, automobiles, etc. that are owned by the company. To learn more, see Explanation of Balance Sheet. To Top
Assets that are used in the business, which exist physically, and are not for sale to customers.
The original cost of assets, less their accumulated depreciation. Often called fixed assets. Accounting does not normally use market prices, either selling prices or replacement costs, for fixed assets. Reasons may be that the company usually does not intend to sell these assets, so their market resale prices are not relevant; original cost is a verifiable, objective number, while market prices (selling or buying) fluctuate; and financial statements portray the stewardship of the managers, so it is natural to show how they spent the money entrusted to them by shareholders.