Unit6AssetsCurrentAssets II.Definition ofCurrentAssetsII.CurrentAssetsAccounts
Unit 6 Assets—Current Assets Ⅰ Ⅰ. Definition of Current Assets Ⅱ. Current Assets Accounts
AssetsDefinition:Assets areeconomic resourcesthataremeasurableinmonetary terms and owned or controlled by an enterprise forthe purpose of making profitsRecognition condition:An asset is recognized onthebalance sheet whenDit is probablethat thefutureeconomic benefits will flowtothe enterprise and②the asset has a cost or value that can be reliably measured2
2 Assets Definition: ⚫ Assets are economic resources that are measurable in monetary terms and owned or controlled by an enterprise for the purpose of making profits. Recognition condition: ⚫ An asset is recognized on the balance sheet when ①it is probable that the future economic benefits will flow to the enterprise and ②the asset has a cost or value that can be reliably measured
I .Definition of Current AssetsCurrentassets areassetsthatareexpected tobeconverted to cash, sold or consumed within 12months or within the business's normal operatingcycle if longer than a year. Current assets should include cash, short-terminvestment, receivable, prepayment and inventory.3
3 Ⅰ. Definition of Current Assets ⚫ Current assets are assets that are expected to be converted to cash, sold or consumed within 12 months or within the business’s normal operating cycle if longer than a year. ⚫ Current assets should include cash, short-term investment, receivable, prepayment and inventory
Currentassetsonthebalancesheetrepresent a company's liquidityThe more cash and short-terminvestments onhand,thelower afirm's risk of failure becausemanagement can use the money tocarry itself through tough periods
4 ⚫ Current assets on the balance sheet represent a company's liquidity. The more cash and short-term investments on hand, the lower a firm's risk of failure because management can use the money to carry itself through tough periods
II, Current Assets Accounts1.Assets101 Cash102 Accounts Receivable103NotesReceivable104 Office Supplies105 Equipment106Inventory107PrepaidInsurance108Land109Accumulated Depreciation110Intangible Assets5
5 Ⅱ. Current Assets Accounts ⚫ 1.Assets 101 Cash 102 Accounts Receivable 103 Notes Receivable 104 Office Supplies 105 Equipment 106 Inventory 107 Prepaid Insurance 108 Land 109 Accumulated Depreciation 110Intangible Assets