A current asset:A) Has a life of less than one year.B) Includes accounts payable.C) Is an illiquid asset.D) Is included in the statement of comprehensive income.E) Is part of shareholders' equity.

Question

A current asset:A)  Has a life of less than one year.B)  Includes accounts payable.C)  Is an illiquid asset.D)  Is included in the statement of comprehensive income.E)  Is part of shareholders' equity.

Ataa Hossen Jafri · Accepted Answer

Final Answer : A, Explanation :  Current assets are assets that are expected to be converted into cash, sold, or consumed within one year or within the operating cycle of the business, whichever is longer. Accounts payable is a liability, not an asset. Illiquid assets are not easily converted into cash and thus not considered current assets. Current assets are reported on the balance sheet, not in the statement of comprehensive income. Shareholders' equity represents the owners' claims on the business after liabilities have been subtracted from assets, and does not include current assets directly.

A current asset:

A) Has a life of less than one year.
B) Includes accounts payable.
C) Is an illiquid asset.
D) Is included in the statement of comprehensive income.
E) Is part of shareholders' equity.

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