Fundamental Payroll Certification (FPC) Practice Exam

Tangible assets are physical items that can be touched or physically measured, and they typically include things like buildings, automobiles, and land. These assets have a definite value and can be used in business operations or sold. Software, on the other hand, is generally classified as an intangible asset. Intangible assets are non-physical in nature and include items such as patents, trademarks, and software. Although software does hold value and can greatly impact a business's operations, it lacks a physical form, which is why it does not fall under the category of tangible assets. Understanding the distinction between tangible and intangible assets is crucial in accounting and financial reporting, as they are treated differently in terms of depreciation and asset valuation.