Meaning: Depreciation is calculated on the fixed tangible asset of a business, so such assets are known as depreciable assets. There is reduction in value of some assets due to their limited life, they are also called as depreciable assets.

Explanation: In normal circumstances, the following explanation can be given for depreciable assets :

1. An asset which has limited life, such asset is called as depreciable asset, e.g., Furniture, Machine, Vehicles, etc. But asset which has unlimited life, this kind of asset is not considered as depreciable asset, e.g., Land.
2. An asset which is purchased for the purpose of business use, it means, which is not purchased for sale, such asset is called as depreciable asset, e.g., Furniture and fixtures, A.C. machine, Motor-car, etc.
3. An asset which is used for more than one accounting year, such asset is called as depreciable asset.

List of depreciable assets: The list of depreciable assets is as follows :

• Plant and Machines;
• Furniture and fixtures;
• Building;
• Leasehold properties;
• Vehicles;
• Goodwill, Patent, Trademark, Copyright, etc.
• Mines, Oil wells and gas wells;
• Loose tools.