Eugenia's company bought a delivery truck to deliver merchandise to customers. This truck should appear as _____ on the balance sheet.

Question

Quizplus · Accepted Answer

The truck is a fixed asset as it is a long-term asset that will be used for a significant period of time to help the company earn revenue. It is not a current asset as it is not expected to be sold or converted into cash within a year, and it is not inventory as it is not a finished good waiting to be sold. It is also not a short-term investment as it is not held for the purpose of generating a quick return.

Eugenia's Company Bought a Delivery Truck to Deliver Merchandise to Customers