What defines tangible assets?

Tangible assets are defined as assets that have a physical form and can be touched or physically measured. They include items like machinery, buildings, vehicles, and inventory. This definition is critical because it distinguishes tangible assets from intangible assets, which, while also valuable, do not have a physical presence. Tangible assets play an essential role in a company's operations and can be used directly in production or service delivery, making them vital for generating revenue. They are also often listed on the balance sheet and can be depreciated over time due to wear and tear or obsolescence.

The other options do not accurately define tangible assets: some refer to intangible assets, which are assets like patents or trademarks that lack physical presence but can still generate income; others pertain to liabilities rather than assets. Understanding the distinction between these concepts is crucial for a thorough understanding of accounting and asset management.