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:

GAAP

Stands for Generally Accepted Accounting Principles, which are a common set of accounting rules and standards used in the United States for financial reporting.

IFRS

International Financial Reporting Standards, a set of accounting standards developed by the International Accounting Standards Board (IASB) that is gaining global acceptance.

Deferred Taxes

Taxes applicable to income that has been accrued but not yet paid, due to differences between accounting and tax legislation.

Installment Sales

A method of sale where the buyer makes payments towards the total sale price in installments over time, while the seller recognizes revenue as payments are received.