The Assets That Will Not Be Converted to Cash or Used

question 138

Multiple Choice

The assets that will not be converted to cash or used up within the business's operating cycle or one year, whichever is greater, are called:

• A)long-term assets.
• B)long-term liabilities.
• C)current assets.
• D)current liabilities.

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Definitions:

Callable

A feature of certain financial instruments that allows the issuer to redeem or 'call back' the instrument at a predetermined price before its maturity date, typically applied to bonds.

European

Pertains to financial options or derivatives that can only be exercised at expiration, not before.

Expiration Date

The date on which an options or futures contract is no longer valid and the right to exercise it ceases.

American-Style Options

Options contracts that can be exercised at any time up to the expiration date, providing more flexibility than European-style options.