What term refers to physical items that can be seen and touched?

Tangible assets refer to physical items that possess a measurable value and can be seen and touched. This category of assets includes items such as buildings, machinery, equipment, and vehicles. The key characteristic of tangible assets is their physical presence, which allows them to be utilized in various capacities, such as production or operational purposes.

In contrast, intangible assets are non-physical in nature—examples include patents, trademarks, and goodwill. They represent value in a different way and cannot be physically touched or seen. Fixed assets are a subset of tangible assets that are not expected to be converted into cash or used up within a year, often including long-term items like property and equipment. Current assets, on the other hand, are those expected to be converted to cash or used within one year, which often involves both tangible assets (like inventory) and intangible assets.

The distinction is crucial for understanding how different asset types are categorized and reported in financial statements. Tangible assets specifically denote those you can interact with in a physical sense, emphasizing their importance in both business operations and financial analysis.