Question

Fixed assets are the assets purchased for the purpose of _______.

• A. operating the business
• B. consumption during manufacturing process
• C. resale
• D. as a security to take loan

Answer 1

The correct option is A operating the business

Assets are classified in two parts i.e fixed assets and current assets. To operate any business, there are certain fixed assets which need to be installed like furniture, office building and plant & machinery etc. Stocks , cash on hand, debtors are considered as current assets. Hence Fixed assets are considered to be procured for operating the business.