Fixed assets are ______________.

kept in the business for use over a long period

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meant for conversion into cash as quickly as possible

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meant for resale

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fictitious assets

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Solution

The correct option is B kept in the business for use over a long period
Assets are classified as Current Assets and Fixed Assets.

Fixed Assets are those which are of permanent nature and these exists in the business for a long duration. Like Land & Building, Plant & Machinery etc.

Current Assets are evolve during the process of business. These are fluctuating and changes with each business transaction. Like Inventory, Sundry Debtors, Cash and Bank balances.

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Similar questions

Q. is/ are primarily held for resale in a business.

Q. is/are considered as assets for a business entity.

Fixed assets are those assets which remain in the business for more than a year. State true or false.

Q. The funds spent on fixed assets remain invested in the business for a __________.

Assuming that Proprietary Ratio is 0.6 : 1, state giving reasons, whether the ratio will increase, decrease or will not change in each one of the following cases:

(i) Issue of new equity shares for cash.

(ii) Issue of equity shares against purchase of machinery.

(iii) Issue of debentures against purchase of machiney.

(iv) Redemption of debentures for cash.

(v) Conversion of debentures into preference shares.

(vi) Buy-back of its own shares by a company.

(vii) Purchase of a fixed asset for cash.

(viii) Purchase of a fixed asset on long-term deferred payment basis.

(ix) Sale of a fixed asset costing Rs. 1,00,000 for Rs. 80,000.

(x) Sale of a fixed asset costing Rs. 2,00,000 for Rs. 2,50,000.

(xi) Issue of Bonus Shares.

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