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Essay

Current and Non-current Assets

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Issue:

Business

 

Written by:

Fred S

 

Date added:

April 18, 2016

 

Level:

University

 

Grade:

A

 

No of pages / words:

3 / 589

 

Was viewed:

2695 times

 

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Essay content:

A company's creditors will often be interested in how much that company has in current assets, since these assets can be easily liquidated in case the company goes bankrupt. In addition, current assets are important to most companies as a source of funds for day-to-day operations. For most businesses, the cutoff for classification as current assets is one year from the balance sheet date (Kimmel, Weygandt, & Kieso, 2007)...
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For example, accounts receivable are current assets because the company will collect them and convert them to cash within one year. Supplies is a current asset because the company expects to use it up in operations within one year (Kimmel et al.). Some companies use a period longer than one year to classify assets and liabilities as current because they have an operating cycle longer than one year...
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