Podcast
Questions and Answers
How is an asset defined for accounting purposes?
How is an asset defined for accounting purposes?
Which of the following is NOT classified as a current asset?
Which of the following is NOT classified as a current asset?
Which of the following best describes non-current assets?
Which of the following best describes non-current assets?
Which of the following is typically classified under current liabilities?
Which of the following is typically classified under current liabilities?
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What type of assets are referred to as intangible assets?
What type of assets are referred to as intangible assets?
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Which of the following is a key characteristic of non-current assets?
Which of the following is a key characteristic of non-current assets?
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Which of the following would typically be classified as a current asset?
Which of the following would typically be classified as a current asset?
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What is an essential element for an item to be classified as an asset?
What is an essential element for an item to be classified as an asset?
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Which of the following correctly describes intangible assets?
Which of the following correctly describes intangible assets?
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What would classify as a non-current asset?
What would classify as a non-current asset?
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Study Notes
Assets
- An asset is owned by its owner and is worth something to its owner
- An asset is any right which is of economic value to its owner.
- For accounting purposes, an asset is a present economic resource controlled by the entity as a result of past events.
- Non-current assets are assets that are acquired by the business with the intention of retaining them within the business to help generate profit
- Examples of non-current assets: property, plant and equipment, investment property, financial assets, intangible assets
Liabilities
- Liabilities are obligations of the company.
- Current liabilities are obligations that are expected to be settled within the next 12 months.
- Examples of current liabilities: Accounts payable, salaries payable, interest payable, income tax payable.
Assets
- An asset is owned by its owner and is worth something to its owner
- An asset is any right that is of economic value to its owner
- For accounting purposes, an asset is a present economic resource controlled by the entity as a result of past events
- Non-current assets are acquired by the business with the intention of retaining them within the business to help generate profit
- Examples include Property, plant and equipment. Investment Property, Financial assets, Intangible assets
- Current assets are expected to be converted into cash, sold or consumed within the business's normal operating cycle
- Current liabilities are obligations that are expected to be settled within the business's normal operating cycle
- Examples of current liabilities include Trade Payables, Accrued Expenses, Short-Term Loans, Deferred Tax, and Tax and Social Insurance
- Long-term liabilities are obligations with a maturity date that is longer than 12 months from the balance sheet date
- Examples of long-term liabilities include Long Term Borrowings, Defered Tax, Long Term Provisions
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Description
Test your knowledge on the fundamental concepts of assets and liabilities in accounting. This quiz covers definitions, classifications, and examples of both non-current and current assets and liabilities. Perfect for students and professionals looking to reinforce their understanding of accounting principles.
