Fixed assets are assets to be used by a business for long term use, while current assets are to be used within the year.
Let's dive a little deeper into fixed assets vs. current assets.
Fixed Assets vs. Current Assets: What's the Difference?
Fixed assets are assets that a company expects to use for more than one year, such as property, plant, and equipment (PPE), while current assets are assets that a company expects to use (or turn into cash) within a year.
Examples of Fixed Assets
- Buildings
- Land
- Office furniture
- Computer equipment
- Vehicles
- Machinery
Examples of Current Assets
- Cash and cash equivalents (assets that can be quickly sold for a known amount of money)
- Inventory
- Accounts receivable
- Prepaid expenses