Examples of non current liability are long term loans

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more than a year. Examples of Non-Current Liability are long-term loans, debentures, etc. (ii) Current Liability: Current Liability is that liability which is payable within a year. Examples of Current Liability are creditors, bills payable, short-term loans, etc. Q.6. Define asset. Ans. Asset is property or legal rights owned by a business to which money value can be attached. Assets can be classified in to (i) Non-current Assets, and (ii) Current Assets: (i) Non- current Assets: Non- current Assets are those assets which are held by a business from a long-term point of view. They are not held with a purpose to resell but are held either as investment or to facilitate business operations. (a) Tangible Assets: Tangible Assets are those assets which have physical existence, i.e., they can be seen and touched. Examples of Tangible Assets are land, building, machinery, computer, goods etc. (b) Intangible Assets: Intangible Assets are those assets which do not have physical existence, i.e., they can not be seen and touched. Examples of Inangible Assets are land, building, machinery, computer etc. (ii) Current Assets : Current Assets are those assets which are held by the business with the purpose of converting them into cash within a short period, i.e., one year. For example, goods are purchased with a purpose to resell and earn profit, debtors exist to convert them into cash, i.e., receive the amount from them, bills receivable exist again for receiving cash against it, etc. (iii) Fictitious Assets : Fictitious Assets are those assets which are neither tangible assets nor intangible assets. They are losses written off not in the year in which they are incurred but in more than one accounting period. Q.7. What is receipts ? Ans. Receipts is the amount received or receivable for selling assets, goods or services. Receipts are categorised into: - Revenue Receipts: It is the amount received or receivable in the normal course of business. For example, amount received or receivable against sale of goods or rendering of services.
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13 Address: Plot No 420, Behind Shopprix Mall, Vaishali Sector 5, Ghaziabad 201010 M: 9999907099, 9818932244 O: 0120-4130999 Website: , Capital Receipts: It is the amount received or receivable against transactions which are not revenue in nature. For example, amount received or receivable for sale of machinery, building, furniture, loan etc. Q.8. What is expenditure ? Ans. Expenditure is the amount spent or liability incurred for acquiring assets, goods or services. Expenditure may be categorised into: (i) Capital Expenditure : It is an expenditure incurred to acquire assets or improving the existing assets which will increase the earning capacity of the business, i.e., will give benefit to the business in more than one accounting year. (ii) Revenue expenditure : Revenue expenditure is the expenditure incurred, the benefit of which is consumed or exhausted within the accounting period. It has direct relationship with revenue or with the accounting period, e.g., cost of goods sold, salaries , rent, electricity expenses, etc.
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