Which statement about noncurrent assets is true?

• A. Assets that are expected to be turned into cash within one year.
• B. Assets used in daily operations and consumed within a year.
• C. Assets that are not expected to be realized or converted to cash within one year, such as long-term investments, patents, and property, plant and equipment.
• D. Liabilities due within one year.

Answer: (C)

Noncurrent assets are resources a business expects to hold for longer than one year or its operating cycle, not being realized or converted to cash in the near term. This includes long-term investments, intangible assets like patents, and physical long-lived assets such as property, plant and equipment. The statement that lists these types of assets and notes they’re not expected to be realized or converted to cash within one year aligns with how noncurrent assets function on the balance sheet. In contrast, items described as being turned into cash or used up within a year are current assets, and items due within one year are current liabilities, so they don’t describe noncurrent assets.