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What is the difference between Current assets - current liabilities?

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Question ajoutée par mohamed Hakim CMA CPA Candidate , Accounting Manager , Andersen saudi arabia
Date de publication: 2014/09/13
Barbara Moretti
par Barbara Moretti , Sales director , Dome srl

It is the financial stability of the company in the short term does not include what is cyclical but everything is operating.

SREEDEVI SUNILKUMAR
par SREEDEVI SUNILKUMAR , Business finance officer , Emirates Airline

current asset is something you own and that you can sell within one year for a profit. Here is an example: Say you own a greenhouse, and you currently have300 bedding plants that you can sell for $3 each. those bedding plants are a current asset because you can sell those plants and make a profit of of them within a year. Now, a current liability is something that you owe someone and that has to be paid of within a year. Ok lets go back to that greenhouse Situation: So you own that same greenhouse, and you take out a small loan of X amount of dollars on January2nd. The bank tells you that you must have this paid off by January2nd of next year. This would be a current liability

Current assets, represents a short term instruments like bank balances, stocks in hand, debtors, having high liquidity to convert to cash and current liabilities represents short terms loans/overdrafs, creditors with short terms liabilities.

Working capital is the difference between CA & CL. You have + Working capital when CA is larger than CL. If CL is larger than CA then you or your company runnung with cash flow irregularity 

ahmed shehab eldin
par ahmed shehab eldin , accountant , egic consultine enginerring

 I known as working capital which represents operating liquidity available to business. Positive working capital is required to make sure that a company is capable to carry on its business and has adequate funds to satisfy both maturing short-term debt and future operational expenses.

mohamed Hakim CMA CPA Candidate
par mohamed Hakim CMA CPA Candidate , Accounting Manager , Andersen saudi arabia

very good

thanks  SREEDEVI SUNILKUMAR

 

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