Question

Current assets are those assets which get converted into cash ____________.

• A. between one and three year
  
• B. within a year
• C. between three and five year
  
• D. cannot be converted easily into cash

Answer 1

The correct option is B within a year

Current asset is an asset, which can either be converted to cash or can be used to pay current liabilities within 12 months. It is the liquid form of assets and is a part of working capital of a firm.

Examples of current assets are cash, cash equivalents, short-term investments made by the company, accounts receivable, stock of inventory, prepaid liabilities etc.