how do tangible assets contribute towards the generation of profits?give two examples. Related: Management as an Art, Science and Profession (Overview)?

Question

how do tangible assets contribute towards the  generation of profits?give two examples. Related:  Management as an Art, Science and Profession (Overview)?

Answer

Tangible Assets are defined as any physical assets owned by a company that can be quantified with relative ease and are used to carry out its business operations. These can include any kind of physical properties such as a piece of land that might be owned by a company along with any structure built upon it, including the furniture, machinery, and equipment housed in it.

List of Tangible Assets Examples

Property –
Property includes land, building, office furniture, etc
Plant
– Plant is the physical space where the workers work or provide services
Equipment
– This refers to the machinery, vehicles and other tools & equipment used to produce
Inventory
– This includes all
types of inventory
like the finished goods as well as WIP and raw material inventory

Tangible Assets Examples in Companies

Depending on the type of company, these assets may or may not make the most significant asset amounts. Here are the two tangible asset examples –

High Capex companies
like Oil and Gas companies, Real Estate Companies, Car Manufacturers have a large percentage of
total assets
tied up in Plant, Equipment, and Machinery. Therefore, you will find a large amount of tangible assets on the balance sheet.
Services companies
like Microsoft or Infosys will have far fewer assets. Such companies own a large number of intangible assets like patents, copyrights, etc.

Top Courses for CommerceView all

Chapter Notes for Commerce

Economics Class 12

Economics Class 11

NCERT Books & Solutions for Commerce

Economics for CBSE Class 12 Board Examinations

Top Courses for Commerce

Top Courses for Commerce

Suggested Free Tests

Related Content

Commerce Courses

Other Courses

How To Prepare?

Related Exams

Company