Is sinking fund a current asset?

Question

0

Koenig 0 Comments

I know that a current asset is expected to bring economic benefit within the following twelve months but I can’t thing of a way that sinking fund can be recorded as a current asset. Would it be possible for a sinking fund to be a current asset?

1 Answer

score 0 · Answer 1 · 2012-12-02T20:22:18+00:00

Current assets include assets that are expected to bring economic benefits within the next twelve months. In other words, current assets are expected to be realized within a year. A sinking fund is not expected to be realized within a year (most of the times) so most of the times, it is a non current asset.