Current & Non-Current Assets

Jaime007 · #1 May 21, 2007, 05:14 PM

Why is classification of Assets into Current & Non-Current necessary? Or not necessary?

RichardBondMan · May 21, 2007, 05:22 PM

Current assets are those that can be coverted to cash quickly and non current assets are those that cannot. Current assets can be used to pay current liabilities which are liabilities that, if I remember correctly, are due in payable within a short period time of less than a year. Yes, the two classifications are necessay for many reasons and one main reason is that a company cannot normally function without liquid assests to pay obligations as they fall due.

Jaime007 · May 21, 2007, 05:28 PM

Quote:

Originally Posted by Jaime007

Why is classification of Assets into Current & Non-Current necessary? Or not necessary?

Thanks for the great answer. Can you remember any of the other reasons that it is necessary?

RichardBondMan · May 21, 2007, 05:38 PM

Try Googling it, Wikepedia and Current assets or that and current liabilities, read all you can there. I am sure there are other reasons.



At Ask Me Help Desk you can ask questions in any topic and have them answered for free by our experts. To ask questions or participate in answering them you must register for a free account. By registering you will be able to: Get free answers from experts in any of our 300+ topics. Accept money for answers that you provide. Communicate privately with other members (PM). See fewer ads. Sign Up!