Under IAS 1 the classification of assets into current and non-current will depend on the entity's:
A)average operating cycle.
B)current accounting period.
C)ordinary course of business.
D)normal operating cycle.

Question

Quizplus · Accepted Answer

IAS 1 requires an entity to classify an asset as current if it is expected to be realized within the entity's normal operating cycle, if the asset is held for trading, or if the asset is expected to be realized within 12 months of the reporting date. If an asset is not expected to be realized within the entity's normal operating cycle or within 12 months of the reporting date, it should be classified as non-current. Therefore, the correct choice is D, normal operating cycle.

Under IAS 1 the Classification of Assets into Current and Non-Current