Which of the following is an example of a non-depreciable asset?

Which of the following is an example of a non-depreciable asset?

• A. Land
• B. Rental property
• C. Vehicles
• D. Office furniture

Answer: (A)

A non-depreciable asset is one that does not lose value over time due to wear and tear or obsolescence, which is typically the case for land. Unlike other assets such as rental property, vehicles, or office furniture, land is not subject to depreciation because it does not have a finite useful life. Instead, land may actually appreciate in value due to various factors such as location, demand, and market trends. In contrast, rental properties, vehicles, and office furniture all have limited useful lives and typically experience a decline in value as they age and are used. These assets can be depreciated over time to reflect their decreasing value on financial statements and for tax purposes. Therefore, identifying land as a non-depreciable asset is fundamental in understanding asset classification and treatment in accounting and taxation.

A non-depreciable asset is one that does not lose value over time due to wear and tear or obsolescence, which is typically the case for land. Unlike other assets such as rental property, vehicles, or office furniture, land is not subject to depreciation because it does not have a finite useful life. Instead, land may actually appreciate in value due to various factors such as location, demand, and market trends.

In contrast, rental properties, vehicles, and office furniture all have limited useful lives and typically experience a decline in value as they age and are used. These assets can be depreciated over time to reflect their decreasing value on financial statements and for tax purposes. Therefore, identifying land as a non-depreciable asset is fundamental in understanding asset classification and treatment in accounting and taxation.