The Classification of Assets into Current or Non-Current in the Statement

question 71

Multiple Choice

The classification of assets into current or non-current in the statement of financial position will provide useful information on the short-term solvency of the entity:

• A) when the entity supplies goods or services within a clearly identifiable normal operating cycle.
• B) when the operating cycle of the entity is greater than 12 months.
• C) when the operating cycle of the entity is less than 12 months.
• D) when the entity is a financial institution.

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Definitions:

Standard Deviation

It quantifies the spread of a dataset, illustrating how much individual data points diverge from the mean value.

Z-score

A measure of how many standard deviations an element is from the mean; used in statistics for standardizing scores.

Symmetrical Area

An area where two sections of a distribution or figure are mirror images of each other, indicating balance around a central point.

Value

The significance or worth of something, often numerical, but can also be qualitative in context such as moral values.