[amp_mcq option1=”Current, fixed” option2=”Fixed, intangible” option3=”Tangible, intangible” option4=”Fixed, current” correct=”option1″]
The correct answer is: A. Current, fixed
Office equipment is a current asset for a computer manufacturer because it is used in the day-to-day operations of the business and is expected to be converted into cash within one year. The same office equipment is a fixed asset for a company that deals in these equipments because it is held for sale and is not expected to be converted into cash within one year.
A current asset is an asset that is expected to be converted into cash or used up within one year. Examples of current assets include cash, accounts receivable, inventory, and short-term investments.
A fixed asset is an asset that is not expected to be converted into cash or used up within one year. Examples of fixed assets include land, buildings, equipment, and machinery.
I hope this helps! Let me know if you have any other questions.