When it comes to accounting, equipment is categorized as a long-term asset on a company's balance sheet. Equipment refers to tangible assets that are used in the production of goods or services, and are expected to be used for more than one accounting period. This categorization is important because it helps businesses track the value of their assets over time, and can impact financial statements and tax liabilities.

In accounting, equipment is typically divided into two categories: fixed assets and depreciating assets. Fixed assets are long-term assets that are not expected to be consumed or converted into cash within one year. These assets are typically used in the production of goods or services, and can include machinery, vehicles, computers, and furniture. Depreciating assets, on the other hand, are equipment that loses value over time due to wear and tear, obsolescence, or other factors. Businesses are required to account for the depreciation of these assets on their financial statements to accurately reflect their value.

When recording equipment on a company's balance sheet, it is important to accurately account for its cost, useful life, and depreciation. The cost of equipment includes not only the purchase price, but also any additional costs incurred to get the equipment ready for use, such as installation, delivery, and training expenses. The useful life of equipment is an estimate of how long the equipment is expected to be used by the business before it needs to be replaced. Depreciation is the process of allocating the cost of equipment over its useful life, and can be calculated using various methods such as straight-line depreciation, double-declining balance depreciation, or units of production depreciation.

Properly categorizing equipment in accounting is crucial for businesses to accurately track their assets and make informed financial decisions. By understanding the categories of equipment and how they are accounted for, businesses can ensure that their financial statements are accurate and compliant with accounting standards. Additionally, categorizing equipment correctly can also impact a company's tax liabilities, as depreciation expenses can be deducted from taxable income. Overall, equipment plays a critical role in a company's financial health, and proper accounting of these assets is essential for long-term success.