Case 3-2 - Aimee Powers Case 3-2 The usefulness of the...

Info icon This preview shows pages 1–2. Sign up to view the full content.

View Full Document Right Arrow Icon
Aimee Powers Case 3-2 10/4/16 The usefulness of the balance sheet is enhanced when assets and liabilities are grouped according to common characteristics. The broad distinction made in the balance sheet is the current versus noncurrent classification of both assets and liabilities. Required: 1. Discuss the factors that determine whether an asset or liability should be classified as current or noncurrent in a balance sheet. Current assets include cash and other assets that are reasonably expected to be converted to cash or consumed during one year or within the normal operating cycle of the business if the operating cycle is longer than one year. All other assets are classified as various types of noncurrent assets. Current liabilities are those obligations that are expected to be satisfied through the use of current assets or the creation of other current liabilities. All other liabilities are classified as long term. Current liabilities include notes and accounts payable, deferred revenues, accrued liabilities, and the current maturities of long-term debt. Long-term
Image of page 1

Info icon This preview has intentionally blurred sections. Sign up to view the full version.

View Full Document Right Arrow Icon
Image of page 2
This is the end of the preview. Sign up to access the rest of the document.

{[ snackBarMessage ]}

What students are saying

  • Left Quote Icon

    As a current student on this bumpy collegiate pathway, I stumbled upon Course Hero, where I can find study resources for nearly all my courses, get online help from tutors 24/7, and even share my old projects, papers, and lecture notes with other students.

    Student Picture

    Kiran Temple University Fox School of Business ‘17, Course Hero Intern

  • Left Quote Icon

    I cannot even describe how much Course Hero helped me this summer. It’s truly become something I can always rely on and help me. In the end, I was not only able to survive summer classes, but I was able to thrive thanks to Course Hero.

    Student Picture

    Dana University of Pennsylvania ‘17, Course Hero Intern

  • Left Quote Icon

    The ability to access any university’s resources through Course Hero proved invaluable in my case. I was behind on Tulane coursework and actually used UCLA’s materials to help me move forward and get everything together on time.

    Student Picture

    Jill Tulane University ‘16, Course Hero Intern