What category does PPE fall under when referring to shop fittings?

Property, Plant, and Equipment (PPE) refers to long-term tangible assets that a business uses in its operations to generate revenue. Shop fittings, which include items such as shelving, display counters, and signage, are physical assets that a business utilizes over a period longer than one year.

Classifying these fittings as non-current assets is appropriate because they are not intended for sale in the ordinary course of business and are essential for the day-to-day functioning of a retail establishment. Unlike current liabilities, which represent obligations due within a year, or intangible assets, which represent non-physical resources like trademarks or patents, PPE is significant because it directly contributes to the operational capacity and efficiency of the business.

Goodwill, on the other hand, represents the excess value of a business over its tangible and identifiable intangible assets, usually arising from strong brand reputation, customer relationships, and other factors. It is not applicable to physical shop fittings.

Therefore, the classification of shop fittings as non-current assets is the correct choice, as it aligns with the business accounting principles regarding the categorization of long-term tangible assets.