Question

Items that have a useful life of more than one year and used in the business

Answer 1

Answer:

They are non-current assets

Explanation:

Items that have a useful life of more than one year and used in the business are non-current assets.

Non-current assets

Non-current assets are assets which represent a longer-term investment and cannot be converted into cash quickly. They are likely to be held by a company for more than a year. They appear in the assets section of balance sheet.

Non-current assets include the following:

• Land
• Building
• Property, plant and equipment
• Machinery
• Fixture and fittings

These are different from current assets.

Current assets:

Current assets represent all the assets of a company that are expected to be conveniently sold, consumed, utilized or exhausted through the standard business operations, which can lead to their conversion to a cash value over the next one year period. Since current assets is a standard item appearing in the balance sheet, the time horizon represents one year from the date shown in the heading of the company's balance sheet.

Examples of current assets include

• Cash,
• Cash equivalents,
• Accounts receivable,
• Stock inventory,
• Marketable securities,
• Pre-paid liabilities, and other liquid assets.

In a few jurisdictions, the term is also known as current accounts.