01-13-2006, 03:49 PM
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According to my knowledge, current assets are thse that will benefit the company within one year or within one accounting cycle (whichever one is longer).
No codition exists for "easily convertible" bcoz it is a quaitative and relative term n has no properly defined definition of what actually is meant by "easily".
for example, inventory is less easily converted to cash as compared to our investments in portfolio but both r current assets. or, prepayments are also current assets but they never r converted into cash (they r expensed out as monthly charges etc.)
this second example explains why i used "benefit the company" only instead of saying "converted into cash"
well these r my concepts only, u may differ indeed )
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FARHAN
live, n let live ...
According to my knowledge, current assets are thse that will benefit the company within one year or within one accounting cycle (whichever one is longer).
No codition exists for "easily convertible" bcoz it is a quaitative and relative term n has no properly defined definition of what actually is meant by "easily".
for example, inventory is less easily converted to cash as compared to our investments in portfolio but both r current assets. or, prepayments are also current assets but they never r converted into cash (they r expensed out as monthly charges etc.)
this second example explains why i used "benefit the company" only instead of saying "converted into cash"
well these r my concepts only, u may differ indeed )
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FARHAN
live, n let live ...
