CRCST Practice Exam

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What timeframe typically defines a current asset?

  1. Within six months

  2. Within two years

  3. Within one year

  4. Within three years

The correct answer is: Within one year

A current asset is an asset that is expected to be converted into cash or used up within one year or within the normal operating cycle of a business, whichever is longer. This timeframe is important for assessing an organization's liquidity and ability to meet short-term obligations. Options A, B, and D exceed the typical timeframe for a current asset and are therefore incorrect.

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