Accounting principles | business valuation | topics | career center | dictionary | accounting Q & A | quizzes | about us

Popular Accounting Topics

Accounting for Merchandising Activities
Debits and Credits (Double Entry Accounting)
Time Value of Money & Present/Future Values
Complex Debt & Equity Instruments
Common Stock & Shareholder's Equity
Accounting & Finance Ratios
Valuing Common Stock
Corporate Income Taxes
Lower of Cost or Market (LCM) & Inventory Valuation
Chart of Accounts & Bookkeeping
Bonds Payable & Long Term Liabilities
Capital Assets

What category of browser are you on this website?

Current Assets

Cash or other assets that are expected to be sold, collected, or used within the longer of one year or the company's operating cycle. The way current assets are structured is important in determining the company’s short term ability to pay its debts.

For instance, cash, cash and equivalents and temporary investments are more liquid than accounts receivable, notes receivable and merchandise inventory. We know that cash and short term investments can be used to pay off debts, pay suppliers, employees’ wages, etc. However, merchandise inventory and accounts receivable must be converted in to cash before they are any good to the company.

>> More Accounting Terms & Glossary?

© Accounting Scholar | Privacy Policy & Disclaimer | Contact Us