Which of the following are current assets?

Bank loan for three years.

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Account receivable.

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Long-term investments.

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Debentures sinking fund investments.

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Solution

The correct option is C Account receivable.
Current assets are those which are convertible into cash in short period of time i.e within a year. Accounts receivable reflects the amount to be received from the debtors for the sales made. Since, such amounts for sales made are receivable in the short period, accounts receivable are classified as current assets.

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2. Interest paid on debentures issued ₹ 20,000.

3. Dividend received on shares held as investment ₹ 20,000.

4. Dividend paid on Equity Share Capital ₹ 30,000.

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	Rs
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Debentures Redemption Fund	1,25,000
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