Q1TI_3 - Horngren'S Financial And Managerial Accounting

Question

For each account listed, identify the category in which it would appear on a classified balance sheet.

3. Land

Step-by-Step Solution

Answer

Land reported as Property, Plant, and Equipment. 

Step-by-Step-Solution

Step 1: Explanation on Property, Plant and Equipment

Property, plant and equipment are the long term assets of the business. It includes the land, buildings, furniture and equipment, which are used in the operation of business. 

Step 2: Explanation on Land

Land is the part of property, plant and equipment category, as it is purchased to set up the factory, for the operation of the business. It is fixed in nature and hence reported as Property, plant and equipment.