Current Asset Section of the Balance Sheet

The current assets section of the balance sheet reports the assets your company has that will be converted into cash in a year. On the balance sheet, the current assets are generally listed in order of liquidity, which is how quickly the assets will be converted into cash.

Below is a list of the common categories found in the current asset section of the balance sheet (listed in the normal order of liquidity):

• Cash – listed at its current balance on the date of the balance sheet. This includes your company’s savings and checking accounts.
• Short-Term Investments – listed at their fair value, which is the price you could sell the investment for now. This would include certificate of deposits and other similar short-term investments that are close to their maturity date.
• Accounts Receivable – reported at the amount you think you will actually collect from your total receivables. The accounts receivable balance is often reported showing total receivables less estimated bad debt.
• Inventories – presented in the basis you value your inventory, such as Costs, First In First Out (FIFO) or Last in First Out (LIFO).
• Prepaid Items – are expenditures you have already made for costs or services, such as insurance or equipment rent, that are paid in advance.