What is the primary difference between a current asset and a non-current asset?

The primary distinction between current assets and non-current assets lies in their liquidity and the time frame in which they are expected to be converted into cash. Current assets are defined as assets that a company anticipates converting into cash or using up within one year or within its operating cycle, whichever is longer. Common examples include cash, accounts receivable, and inventory. This feature is critical for maintaining a company's liquidity and its ability to meet short-term obligations.

In contrast, non-current assets, also known as long-term assets, include items that will not be converted into cash or used up within a single year, such as property, plant, equipment, and intangible assets. These assets are typically held for the long term to support the company’s operations and growth.

The other options do not accurately describe the distinction. While it's true that non-current assets might generally hold more value or require long-term investment, and current assets have limitations on sale during operational cycles, these aspects do not define the primary difference between the two types of assets. The essence of understanding these categories revolves around their expected timeframe for conversion into cash.