Asked by RAM SAI DINESH REDDY on Jun 08, 2024
Verified
The current assets section of a balance sheet includes both inventory and prepaid expenses.
Current Assets
Resources anticipated to be turned into cash, sold, or used up within a year or during the business's usual operating period, if that period extends beyond a year.
Inventory
Goods and materials that a business holds for the purpose of resale or as part of its production process.
Prepaid Expenses
Expenses paid in advance for goods or services to be received in the future, which are recorded as assets on a balance sheet until they are realized.
- Recognizing the build and components of the balance sheet, highlighting assets, shareholders' equity, and obligations.
- Proficiency in identifying the purpose and method of treating different components in financial disclosures, including assets (current and fixed), liabilities, and stockholders’ equity segments like common stock and additional paid-in capital.
Verified Answer
Learning Objectives
- Recognizing the build and components of the balance sheet, highlighting assets, shareholders' equity, and obligations.
- Proficiency in identifying the purpose and method of treating different components in financial disclosures, including assets (current and fixed), liabilities, and stockholders’ equity segments like common stock and additional paid-in capital.
Related questions
Current Liabilities Are Defined as Obligations to Be Paid Within ...
Common Stock and Additional-Paid in Capital Represent the Financing Sources ...
Additional Paid-In Capital Is Reported on the Balance Sheet as ...
A Company's Assets and Stockholders' Equity Both Increase When the ...
The Stockholders' Equity Section of a Balance Sheet Includes Capital ...