Current Assets

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What are Current Assets?

Current Assets are cash and other assets which are expected to be converted to cash, consumed, or sold within 12 months of the balance sheet date, or the company's normal operating cycle, whichever is longer.

The Operating Cycle is the average time that is required to go from cash to cash in producing revenues. For example, an airplane manufacturer may have an operating cycle longer than a year because it takes more time to build an airplane (cash expenditures) and sell it (cash receipt). In such cases, the current versus non-current classification will be based on a period longer than a year after the balance sheet date.

Current assets are also called Liquid Assets or Short-term Assets.

List of Current Assets. Types

Current or liquid assets include items such as:

• Cash (cash money, bank accounts)
• Cash Equivalents (e.g., certificates of deposit)
• Short-term Deposits
• Marketable Securities (expected to be sold within 1 year, for example common stock, treasury bills, money market instruments)
• Accounts Receivable (invoices sent to clients)
• Work in Progress
• Raw Materials
• Finished Goods / Inventory (to be sold within 1 year)
• Prepaid Insurance
• Prepaid Expenses
• Other liquid assets (e.g., office supplies)

Current Assets are listed on the company's balance sheet.

The difference between current assets and current liabilities is called Working Capital.

Non-current Assets

Non-current assets include items such as:

• Fixed Assets:
  • Land
  • Buildings
  • Factories
  • Furniture
  • Equipment
  • Computers / Office Equipment
• Intangible Assets:
  • Brands
  • Corporate Reputation
  • Copyrights
  • Patents
  • Trademarks
  • Trade Secrets
  • Know-how / Tacit Knowledge
  • Goodwill
• Leasehold improvements

Forum Forum about Current Assets. Quotes on Current Assets. Quotations Hi, do you know of a remarkable, humorous quote by a famous person or a proverb related to current assets?Please enter a reaction to share it for other people to enjoy! Please use this template:Author... 2   2 comments 🔥 Contra Asset Accounts For a company, an asset could be defined as a resource it owns having an economic value that can be expressed and measured in monetary terms. Assets benefit the firm's operation and help to increase i... 0   Start a new topic about Current Assets Sign up for free

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Information Sources Various sources of information regarding Current Assets. Here you will find powerpoints, videos, news, etc. to use in your own lectures and workshops. Introduction to the Balance Sheet Initial Understanding of a Balance Sheet, Financial Statement Analysis, Accounting This video explains the main terms you need to read a balance sheet Assets: things a company owns that have value. -...

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Compare with: Intangible Assets  |  Current Liabilities  |  Working Capital

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