Classifying Business Resources

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What is the term for resources that can be changed into cash within a brief period, typically 1 year or less?

Intangible resources

Fixed resources

Current resources (correct)

Investments

Which of the following resources cannot be easily converted into cash within a year?

Fixed resources (correct)

Current resources

Investments

Intangible resources

What is the term for resources that have a physical existence, but cannot be seen or touched?

Intangible resources (correct)

Current resources

Fixed resources

Investments

What is the primary difference between current and fixed resources?

Their ability to be converted into cash Signup and view all the answers

Which of the following is an example of an investment?

A stock Signup and view all the answers

Which of the following expenses is most likely to be classified as a capital expenditure?

Cost of formation of a new company Signup and view all the answers

What is the primary characteristic of a capital expenditure?

It is a one-time large expense Signup and view all the answers

Which of the following is NOT an example of a capital expenditure?

Payment of compensation to a discharged employee Signup and view all the answers

What is the main difference between a capital expenditure and a revenue expenditure?

The purpose of the expense Signup and view all the answers

Which of the following would be classified as a revenue expenditure?

Carriage paid on goods purchased Signup and view all the answers

Classifying Business Resources

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Questions and Answers

What is the term for resources that can be changed into cash within a brief period, typically 1 year or less?

Which of the following resources cannot be easily converted into cash within a year?

What is the term for resources that have a physical existence, but cannot be seen or touched?

What is the primary difference between current and fixed resources?

Which of the following is an example of an investment?

Which of the following expenses is most likely to be classified as a capital expenditure?

What is the primary characteristic of a capital expenditure?

Which of the following is NOT an example of a capital expenditure?

What is the main difference between a capital expenditure and a revenue expenditure?

Which of the following would be classified as a revenue expenditure?

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