Question

The assets that can be converted into cash within a short period (i.e. 1 year or less) are known as _____________.

• A. Current Assets
• B. Fixed Assets
• C. Intangible Assets
• D. Investments

Hint:

Examples of current assets include cash, inventory, and accounts receivable.

Answer 1

The Correct Option is A

Step 1: Understanding asset types.
Assets are classified based on liquidity, i.e., how quickly they can be converted into cash.

Step 2: Evaluating options.

• (A): Correct. Current assets are converted into cash within a year.
• (B): Fixed assets are long-term.
• (C): Intangible assets lack physical form.
• (D): Investments may not be short-term.

Step 3: Conclusion.
Thus, such assets are called current assets.
Final Answer:} Current Assets.