No, land is not a current asset. A current asset is an asset that provides economic value for or within one year. Since land is expected to provide value for longer than a year, it is considered a long-term asset. In fact, land cannot be depreciated over time, making it the most long-lasting asset a company can have.
Is Land a Current Asset? FAQs
No, land is not generally classified as a current asset since it does not usually generate cash within one year from the date of its purchase.
A current asset is an asset that provides economic value for or within one year.
Since land is expected to provide value for longer than a year, it is considered a long-term asset.
Land only appreciates over time. In fact, land cannot be depreciated over time, making it the most long-lasting asset a company can have.
Land may become an investment or financial instrument such as derivatives, securities, and bonds but still would not qualify as a short-term current asset.
True Tamplin is a published author, public speaker, CEO of UpDigital, and founder of Finance Strategists.
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