BSBA FM 2A
Fundamentals of Accounting
SW 1.1
CURRENT ASSETS
●cash and other assets that are expected to be converted to cash within a year.
●Current assets represent all the assets of a company that are expected to be
conveniently sold, consumed, used, or exhausted through standard business operations
with one year. Current assets appear on a company's balance sheet, one of the required
financial statements that must be completed each year.
CASH
●Cash is legal tender—currency or coins—that can be used to exchange goods, debt, or
services. Sometimes it also includes the value of assets that can be easily converted into
cash immediately, as reported by a company.
CASH EQUIVALENTS
● Cash equivalents are investments securities that are meant for short-term investing; they
have high credit quality and are highly liquid.
● Cash equivalents, also known as "cash and equivalents," are one of the three main
asset classes in financial investing, along with stocks and bonds. These securities have
a low-risk, low-return profile and include U.S. government Treasury bills, bank
certificates of deposit, bankers' acceptances, corporate commercial paper, and other
money market instruments.
NOTES RECEIVABLE
● The notes receivable is an account on the balance sheet usually under the current
assets section if its life is less than a year. Specifically, a note receivable is a written
promise to receive money at a future date. The money is usually made up of interest and
principal.
ACCOUNTS RECEIVABLE
●money owed to a company by its debtors.
● is the proceeds or payment which the company will receive from its customers who have
purchased its goods & services on credit.
INVENTORIES
● a complete list of items such as property, goods in stock, or the contents of a building.
