Which of the following is a current asset?
A) Cash surrender value of a life insurance policy of which the company is the beneficiary.
B) Investment in equity securities for the purpose of controlling the issuing company.
C) Cash designated for the purchase of tangible fixed assets.
D) Trade installment receivables normally collectible in 18 months.

Question

Quizplus · Accepted Answer

Trade installment receivables normally collectible in 18 months are considered a current asset as they are expected to be collected and converted into cash within the next year. The cash surrender value of a life insurance policy and investment in equity securities are long-term assets, and cash designated for the purchase of tangible fixed assets is earmarked for a specific long-term purpose.

Which of the Following Is a Current Asset