The classification of liabilities on the basis of timing of settlement,i.e.current and non-current,is useful as it helps decision-makers assess the firm's ability to meet all of the following except:

Question

Quizplus · Accepted Answer

The classification of liabilities only helps decision-makers assess the firm's ability to meet commitments that are part of the operating cycle and capital repayments. Dividends are also not directly related to the timing of settlement of liabilities. Profitability is a separate aspect that is not related to the classification of liabilities.

The Classification of Liabilities on the Basis of Timing of Settlement,i.e.current