The category of items on the balance sheet that typically offers an analyst the best information on a non-financial firm’s investing activities is: A. current liabilities. B. noncurrent liabilities. C. current assets. D. noncurrent assets. Ans: D Can somebody give some examples of non-current assets please? Not sure why the asnwer is D.
what about current assets then say for a company with a lot of equipment?
current assets is items like cash, marketable securities, accounts receivable, inventory, etc. etc. to answer another way - NOT something that is of a more permanent nature like Property, Plant or equipment.
Equipment not considered current assets.
investing activities deal with noncurrent asset, meaning PP@E, or purchases of companies which might involve goodwill.
Company A purchases some shares of Company B. I belive that can be considered a Curent assets. and it is an Investing activity as well right? SO Investing activity can include both Current and Non Current assets. Correct?
Is company A is a financial or non-financial firm?
say Company A = non-financial firm.
I think securities of another company would be marketable securities, and it depends whether the company has the intention to trade these securities in the near future (trading securities, current assets), or available for sale (no current intention to sell those securities, held as either current assets or as long term assets). But since the company is non-financial, these are not “typically” offering information on the investing activities of a company. Most probably, since we are talking about a non-financial company, it would appear on mezzanine, between liabilities and equity, as minority interest (on GAAP basis) or included in equity (on IFRS basis).