No, premises are not a current asset. A current asset is any asset that will provide an economic value for or within one year. Premises, or the property where business is done, is a part of the property, plants, and equipment, or PP&E, account. All PP&E has a useful life longer than one year, premises included, so it is considered a non-current asset.
Is Premises a Current Asset? FAQs
No, premises are not a current asset.
A current asset is any asset that will provide an economic value for or within one year.
Premises, or the property where business is done, is a part of the property, plants and equipment, or PPE account.
All PPE has a useful life longer than one year, premises included, so it is considered a non-current asset.
When accounting for premises, companies should consider costs such as acquisition price, taxes, insurance costs, legal fees, repairs and maintenance expenses, and interest incurred to acquire or build the property.
True Tamplin is a published author, public speaker, CEO of UpDigital, and founder of Finance Strategists.
True is a Certified Educator in Personal Finance (CEPF®), author of The Handy Financial Ratios Guide, a member of the Society for Advancing Business Editing and Writing, contributes to his financial education site, Finance Strategists, and has spoken to various financial communities such as the CFA Institute, as well as university students like his Alma mater, Biola University, where he received a bachelor of science in business and data analytics.
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