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Assets can be divided into two categories: current and noncurrent. Current assets are items listed on a company's balance sheet that are expected to be converted into cash within one fiscal year. Converse to current assets, noncurrent assets are long-term assets that a company expects to hold over one fiscal year that cannot readily be converted to cash within a year.
Since current assets are expected to be converted into cash within one year, they usually include cash, accounts receivable and inventory. Cash is considered a current asset because it can be readily converted within one year and can be used to pay short-term debt. Accounts receivable consist of the expected amount of cash to be collected within one fiscal year. Inventory is a current asset because it includes raw materials and finished goods that are readily available for sale.
Contrary to current assets, noncurrent assets are long-term assets that a company expects to hold longer than one fiscal year. Some examples of noncurrent assets are fixed assets, intangible assets and long-term investments. Fixed assets include property, plans and equipment that a company owns that are not expected to be converted into cash within one fiscal year.
Intangible assets are nonphysical assets, such as patents and copyrights. They are considered to be noncurrent assets because they provide value to a company but cannot be readily converted to cash within a year. Long-term investments, such as bonds and notes, are considered noncurrent assets because a company usually holds these assets on its balance sheet for more than one fiscal year.
There are two types of ASSETS from which company can gain Economic benefits in future.Current and Non-Current Assets.Current Assets are those from which company can gain economic benefit within one year.It have only one year economic life.after it will be expire or reduce their value For example Inventory, Cash.Non-Current Assets are those which have more than one year life. Company can use it in more than one years etc. Vehicles, Machinery, Furniture and fittings. Both are appear in Statement of Financial Position. For Non-Current Assets company calculates depreciation charges every period and charge it to Statement of comprehensive income as an Expense.
Converse to current assets, noncurrent assets are long-term assets that a company expects to hold over one fiscal year that cannot readily be converted to cash within a year. Since current assets are expected to be converted into cash within one year, they usually include cash, accounts receivable and inventory.
Current assets:Current assets are expected to be sold, loaned out, leased, consumed or otherwise used to create income within one year of the date of the operating cycle of the business.
Non-current asset: Non-current asset is any resource not expected to be recovered, meaning monetary value is extracted from it or it is no longer useful, until more than 12 months past the balance sheet date.
Current Asset: If the economic benefit from an asset can realise within a year than it is classified as current asset.
Non current asset: If the economic benefit from an asset can not realise within a year than it is classified as non current asset.
Current assets is fast liquidate assets and which life is not more than 1 year while non-current assets are long term assets which has more than 1 year of life
the current asset we can easly convertible in to cash but non current asset which means fixed and tangible . the fixed asset its very difficult easily convertible and the other one tangible it has no physical shape or existency like goodwill copy right
Current assest can be liqudated immediately or within short period, wherelse non current assets due to contratual and nature of the asset would take time to liquidate.
Current Assets are assets held in normal course of business and expected to be matured within a year, for example sundry debtors, non-current assets are assets held for generate future economic benefit for example plant & machinery.
