Practicing Success

Target Exam

CUET

Subject

Accountancy

Chapter

Financial Statements of a Company

Question:

Which of the following is represented, if the Operating cycle is 11 months and the expected period of payment is 13 months?

Options:

Current assets

Non-current assets

Current liability

Non-current liability

Correct Answer:

Non-current liability

Explanation:

The correct answer is option 4- Non-current liability.

The expected period of payment means it is a liability and if the expected period is more than the operating cycle, then, it is non-current. So, the correct answer is option 4 i.e. non current liability.