what is property plant and equipment pp e 
property plant and equipment pp e are long term tangible assets vital to business operations these assets are not easily converted into cash the overall value of a company s pp e can range from very low to extremely high compared to its total assets investopedia julie bangtypes of assetsproperty plant and equipment are also called fixed assets they are physical assets that a company cannot easily liquidate or sell pp e assets are considered noncurrent assets or long term investments noncurrent assets like pp e have a useful life of at least one year 1types of pp e include noncurrent assets are the opposite of current assets current assets are short term assets like inventory and are likely to be converted into cash within one year accounting for pp epp e is recorded on a company s balance sheet pp e is measured using historical cost or the actual purchase cost when purchasing a building for retail operations the historical cost could include the purchase price transaction fees and any improvements made to the building to bring it to use the gross value of pp e is adjusted for use and depreciation depreciation allocates the cost of a tangible asset over its useful life and accounts for declines in value the total amount allocated to depreciation expense over time is called accumulated depreciation land assets are not depreciated because of their potential to appreciate and are always represented at their current market value the pp e account is remeasured every reporting period and after accounting for historical cost and depreciation is defined as book value this figure is reported on the balance sheet to calculate pp e add the gross property plant and equipment listed on the balance sheet to capital expenditures next subtract accumulated depreciation companies commonly list their net pp e on their balance sheet when reporting financial results net ppe gross ppe capital expenditures ad where ad accumulated depreciation begin aligned text net ppe text gross ppe text capital expenditures text ad textbf where text ad text accumulated depreciation end aligned net ppe gross ppe capital expenditures adwhere ad accumulated depreciation examplebelow is a portion of exxon mobil corporation s xom quarterly balance sheet from sept 30 2018 2 exxon recorded 249 153 billion in net property plant and equipment for the period ending sept 30 2018 compared to exxon s total assets of over 354 billion for the period pp e made up the vast majority of total assets 2 as a result exxon would be considered a capital intensive company some of the company s fixed assets include oil rigs and drilling equipment 