Question

An asset that is generally not expected to be converted to cash or consumed within one year or the operating cycle, whichever is longer, is:
Multiple Choice:
O Building.
O Accounts receivable.
O Inventory.
O Supplies.

Answer 1

Answer:

The answer B.

Explanation:

Non-current asset is a asset that is generally not expected to be converted to cash or consumed within one year or the operating cycle, whichever is longer. They have a useful life of more than. one year. For example, plant and machinery. The assets in this category are depreciated except land which has an infinite useful life.

While current asset is an an asset that is expected to be converted to cash or consumed within one year or the operating cycle, whichever is longer. Example are inventory, cash etc.