23:00
Ropes wen we get dat bama a wanna throw a party
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LSDefine
Simple English definitions for legal terms
current asset
Read a random definition: descriptive word
A quick definition of current asset:
Current asset: A current asset is something a business owns that they plan to sell or use within one year. Examples of current assets include cash, money owed to the business, things the business plans to sell, and other things that can be easily turned into cash.
A more thorough explanation:
Current asset
Current assets are things a business owns that they expect to sell or use up within one year. These things are usually easy to turn into cash. Examples of current assets include:
- Cash
- Accounts receivable (money owed to the business by customers)
- Stock inventory (products the business has in stock to sell)
- Other liquid assets (things that can be easily turned into cash, like short-term investments)
For example, if a business has $10,000 in cash, $5,000 in accounts receivable, and $20,000 worth of products in stock, those are all current assets. The business expects to use that cash to pay bills or buy more inventory within the next year. They expect to sell the products in stock within the next year. And they expect customers to pay the money they owe within the next year.