Final answer:
Equipment is classified as a long-term asset, which is an item of value owned by a firm or individual, typically with a use beyond one year. The way equipment is recorded can vary by organization based on its cost.
Step-by-step explanation:
Equipment is considered to be a long-term asset. An asset is an item of value that a firm or individual owns, and equipment typically has a useful life beyond one year, which classifies it as a long-term asset. However, because some equipment has a low price, it is up to the individual organization as to how it records the equipment. Some may choose to expense cheaper equipment immediately, rather than capitalizing it and depreciating over time. This is often governed by a company's capitalization policy, which sets a threshold cost for what should be recorded as an asset.
Equipment is considered to be a long-term asset because it is an item of value that an organization owns and expects to use for a long period of time. The recording of equipment on a company's balance sheet is determined by its cost and useful life. In general, equipment with a low price and a long useful life is recorded as a long-term asset.