Chapter 8, Problem 21DQ

To determine

Plant assets: Plant assets are assets which are tangible in nature and are used in a company’s operations that have a useful life of more than 1 accounting period. Plant assets are also called as plant and equipment assets.

Current assets: Current assets are those assets which can be converted in form of cash within a short period of time and appear at the asset side of the balance sheet such as cash, inventory, and accounts receivables.

Inventory: Inventory is a type of current asset whose benefit is availed by the company within a shorter period such as raw materials and stock.

Long term investments: Long term investments are the long term assets whose benefit is availed for more than a year.

To identify: The differences between plant assets and current assets, plant assets and inventory, plant assets and long term investments.