Cost of the asset$100,000
Life of the asset 5 years
Depreciation rate20%
Capital cost allowance rate 50%
Residual value of the asset nil
Income tax rate 50%
-Which of the following is a current asset?
A) goodwill
B) prepaid expenses
C) accrued liabilities
D) deferred revenue

Question

Cost of the asset$100,000 
Life of the asset 5 years 
Depreciation rate20% 
Capital cost allowance rate 50% 
Residual value of the asset nil 
Income tax rate 50%
-Which of the following is a current asset?
A) goodwill
B) prepaid expenses
C) accrued liabilities
D) deferred revenue

Quizplus · Accepted Answer

Prepaid expenses are considered current assets because they represent goods or services that have been paid for by the company but have not yet been consumed or used. These are expected to provide benefits within one year or within the operating cycle, whichever is longer.

Cost of the Asset$100,000