Question

Fixed Assets are those assets _____________.

• A. which can be converted into cash within 12 months
• B. which can be held in business for resale
• C. which can be converted into cash during the operating cycle
• D. which are not held for their conversion into cash within an operating cycle which normally does not exceed 12 months

Answer 1

Answer: (D)

which are not held for their conversion into cash within an operating cycle which normally does not exceed 12 months

Fixed Assets are those non-current assets of an enterprise which are held not to resell but with the purpose to increase its earning capacity. They are further classified into;-

1. Tangible Assets- Tangible assets are those assets which have physical existence, i.e., they can be seen and touched. For e.g., Machinery, Building, Land etc.

2. Intangible Assets- Intangible assets are those assets which do not have physical existence, i.e., they cannot be seen and touched. For e.g., Patents, Goodwill, Computer software etc.