Current Assets (Aktiva Lancar)
Definition
Sheet The Balance
Financial statements are the final product of the account process.
They provide information
on the financial condition of a company. The balance sheet, one type of
financial statement, provides a summary of what a company owns and what it owes
on one particular day.
Assets represent everything of value that is owned by a business, such as
property, equipment, and accounts receivable. On the other hand, liabilities
are the debts that a company owes-for example, to suppliers and banks. If
liabilities are subtracted from assets (assets-liabilities), Ammount remain is the owners’
share of a business. This is known as owners’ or stockholders’ equity.One key to understanding the accounting transactions of a business is to understand the relationship of its assets, liabilities, and owners’ equity. This is often represent by the fundamental accounting equation : assets equal liabilities plus owners’ equity.
Assets = Liabilities + Owners’ Equity
The balance sheet expands the accounting equation by providing more information about the assets, liabilities, and owners’ equity of a company at a specific time (for example, on December 31, 1993). It is made up of two parts. The first part lists the company assets, and the second part detais liabilities and owners’ equity. Assets are divide into current and fixed assets. Property, buildings, and equipment make up the fixed assets of a company. The liabilities section of the balance sheet is often divided into current liabilities (such as accounts payable and income taxes payable) and long term liabilities (such as bonds and long-term notes).
The balance sheet provides a financial picture of a company on a particular date and for this reason it is useful in two important areas. Internally, the balance sheet provides managers with financial information for company decision-make. Externally, it gives potential investor data for evaluating the company financial position.
Current assets are that form part of the circulating
capital of a business. They
are replace frequently or convert into cash during the course of trade.
The most common current assets are stocks, trade debtors, and cash.
A fixed asset is an asset of a
business intend for continue use,
rather than a short-term, temporary asset such as stocks. Fixed assets must be
classified in a company's balance sheet as intangible,
tangible, or investments. Examples of intangible assets include
goodwill, patents, and trademarks. Examples of tangible fixed assets include
land and buildings, plant and machinery, fixtures and fittings, motor vehicles
and IT equipment.
liabilities
long term debt
Amount owed
for a period
exceeding 12 months
from the date of the balance
sheet. It could be in the form of a bank loan, mortgage
bonds, debenture,
or other obligations
not due for
one year. A firm must disclose its long-term
debt in
its balance sheet with its interest
rate and date of maturity. Amount of long-term debt is a measure of
a firm's leverage,
and is distinguished from long
term liabilities which may include supply of services
already paid
for.
Definition of 'Short-Term Debt'
An account shown in the current
liabilities portion of a company's balance sheet. This account is
comprise of any debt incure by a company that is due within one year.
The debt in this account is usually made up of short-term bank loans taken out
by a company. Current assets are the type of assets that can be used in the
near term, usually one year. Examples of current assets include cash, accounts
receivable, short-term investments, inventories, and prepaid expenses
Simple present :
1)
Financial statements are the final product of
the account process (+)
Financial
statements are not the final product of the account process (-)
Does Financial statements are the final product
of the account process?
2) They
provide information on the financial condition of a company (+)
They don’t provide information on the
financial condition of a company (-)
Do they provide information on the financial
condition of a company?
3) Ammount
remain is the owners’ share of a business (+)
Ammount doesn’t remain is the owners’ share
of a business (-)
Does ammount remain is the owners’ share of
a business?
4) This
is often represent by the fundamental accounting equation (+)
This is often doesn’t represent by the
fundamental accounting equation (-)
Does this is often represent by the
fundamental accounting equation?
5) Three
factors are express in monetary terms and therefore are limit (+)
Three factors are not express in monetary
terms and therefore are limit (-)
Does three factors are express in monetary
terms and therefore are limit?
6) Assets
are divide into current and fixed assets (+)
Assets are not divide into current and
fixed assets (-)
Does assets are divide into current and
fixed assets?
7) Balance
sheet provides a financial picture of a company on a particular date (+)
Balance sheet doesn’t provides a financial
picture of a company on a particular date (-)
Does balance sheet provides a financial
picture of a company on a particular date?
8)
They replace frequently or convert into cash
during the course of trade.
They don’t doreplace frequently or convert
into cash during the course of trade.
Do They replace frequently or convert into cash during
the course of trade?
9)
A fixed
asset is an asset of a business intend
for continue use
A fixed asset
is not an asset of a business intend for continue use
Does fixed asset
is an asset of a business intend for continue use
10)
This account is
comprise of any debt incure by a company that is due within one year (+)
This account is not comprise
of any debt incure by a company that is due within one year (-)
Does account is
comprise of any debt incure by a company that is due within one year?
