What is not considered a tangible asset?

Patents are not considered tangible assets because they are intangible in nature. Tangible assets are physical items that have a specific value and can be touched or measured. Examples of tangible assets include real estate, which refers to land and buildings, equipment such as machinery and tools, and inventory made up of goods available for sale.

In contrast, patents represent legal rights and protections granted to inventions or processes, but they do not have physical substance. Their value lies in the exclusive rights they confer and the potential for generating future revenue, making them integral to a business's intellectual property but not classifiable as tangible assets. Thus, identifying patents as intangible highlights their key characteristic—lacking physical form—distinguishing them from tangible assets.