Equipment

A fixed asset under the Property, Plant and Equipment caption on the balance sheet. The cost of equipment should include:

• purchase price
• freight and handling charges
• insurance during transit
• special foundations, if needed
• assembling and installation costs
• costs of conducting trial runs

Items typically included under this category are:

• delivery equipment
• office equipment
• machinery
• furniture & fixtures
• furnishings
• factory equipment, etc.

Learn how to analyze a balance sheet in terms of company's liquidity and solvency using financial ratios such as the current ratio, quick (or acid) ratio, debt to asset ratio and debt to equity ratio.