Current Assets. Assets that a company expects to convert to cash or use up within one year or the operating cycle, whichever is longer. Operating cycle is the average time it takes from the purchase of inventory, to the sale of goods, and then to the collection of cash from customers. Common types of current assets are (1) cash, (2) investments, (3) receivables, (4) inventories, and (5) prepaid expenses. LO 1.
Classified Balance Sheet. Illustration SO 5 Distinguish between a multiple-step and a single-step income statement.