Which of the Following is Not a Tangible Asset?
Which of the Following is Not a Tangible Asset?
Are your business assets considered tangible or intangible?
Tangible assets are physical assets that have a physical form and can be touched, whereas intangible assets are non-physical assets that have no physical form and cannot be touched.
Examples of tangible assets include land, buildings, equipment, inventory, and cash. Examples of intangible assets include goodwill, patents, trademarks, and copyrights.
It is important to distinguish between tangible and intangible assets because they are treated differently for accounting and tax purposes. Tangible assets are depreciated over time, while intangible assets are not.
| Tangible Asset | Intangible Asset |
|---|---|
| Land | Goodwill |
| Buildings | Patents |
| Equipment | Trademarks |
| Inventory | Copyrights |
| Cash |
Not all assets are created equal. Some assets, like buildings and equipment, are easy to see and touch. These are called tangible assets. Others, like patents and trademarks, are less tangible. They don't have a physical form, but they can still be very valuable to a business.
Here are some examples of intangible assets:
- Patents: A patent is a government-issued exclusive right to make, use, or sell an invention for a certain period of time.
- Trademarks: A trademark is a word, phrase, symbol, or design that identifies and distinguishes the goods or services of one seller from those of another seller.
- Copyrights: A copyright is a government-issued exclusive right to reproduce, distribute, and perform a literary, artistic, or musical work.
- Goodwill: Goodwill is the reputation of a business that gives it an advantage over its competitors.
Intangible assets can be just as valuable as tangible assets. In fact, some businesses have more intangible assets than tangible assets.
Here are some examples:
- The Coca-Cola Company: Coca-Cola's brand is one of the most valuable intangible assets in the world. It is estimated to be worth over $80 billion.
- Microsoft: Microsoft's software is another valuable intangible asset. It is estimated to be worth over $100 billion.
- Google: Google's search engine is a valuable intangible asset. It is estimated to be worth over $150 billion.
Intangible assets can be a source of competitive advantage for a business. They can help a business to differentiate itself from its competitors and to build a strong brand.
Success Stories
- Intangible assets helped Coca-Cola to become one of the most successful businesses in the world.
- Intangible assets helped Microsoft to become the largest software company in the world.
- Intangible assets helped Google to become the most popular search engine in the world.
FAQs About which of the following is not a tangible asset
1. What is the difference between a tangible asset and an intangible asset?
A tangible asset is a physical asset that has a physical form and can be touched, whereas an intangible asset is a non-physical asset that has no physical form and cannot be touched.
2. What are some examples of tangible assets?
Some examples of tangible assets include land, buildings, equipment, inventory, and cash.
3. What are some examples of intangible assets?
Some examples of intangible assets include goodwill, patents, trademarks, and copyrights.
4. Are intangible assets as valuable as tangible assets?
Yes, intangible assets can be just as valuable as tangible assets. In fact, some businesses have more intangible assets than tangible assets.
5. How can intangible assets help a business?
Intangible assets can help a business to differentiate itself from its competitors and to build a strong brand.
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