Which of the following best defines a depreciable asset?

A depreciable asset is best defined as a long-term tangible asset that decreases in value over time. This is because depreciable assets, such as machinery, vehicles, and buildings, lose value as they get older or as they are used in operations. This decline in value is accounted for through depreciation, which is an accounting method that allocates the cost of the asset over its useful life.

This definition captures the essence of what makes an asset depreciable: its tangible nature and the fact that it has a finite useful life, leading to a systematic reduction in its value. Understanding this concept is crucial for financial reporting and for making informed decisions about asset acquisition and management in a business context.

The other options do not accurately capture the essence of a depreciable asset. For instance, short-term investments that appreciate refer to assets that typically gain value rather than lose it, while financial instruments and intangible assets do not fit the definition of tangible, depreciable assets governed by the same accounting rules.