Which of the following should not be considered as a current asset in the balance sheet?
A) The cash surrender value of a life insurance policy carried by a corporation, the beneficiary, on its president.
B) Marketable securities purchased with cash as a short-term investment.
C) Instalment notes receivable due within 12 months in accordance with normal trade practice.
D) Prepaid taxes which cover assessments of the following operating cycle of the business.

Question

Quizplus · Accepted Answer

The cash surrender value of a life insurance policy carried by a corporation on its president should not be considered as a current asset in the balance sheet because it is not a liquid asset that can readily be used to meet current obligations of the business. Instead, it should be classified as a long-term investment.

Which of the Following Should Not Be Considered as a Current