An assets which has the useful life of maximum one year. This is also called short-term assets. Current assets are intended to be used up, sold, or converted to cash within one year. Few the most common example of current assets are Accounts Receivables, Inventory, Available Cash Apart from this you can insert other current assets if you have any. Instead of depreciation happened into the long term assets, here the short term assets amortize over the time. Meaning the current assets value you would insert, The system will spread(amortize) the values over time(Useful life).
Here are the steps to enter current assets:
Click the ‘Add Assets’ button
Name & Type: Enter Assets name and select Current Assets type from Assets options:
Assets Value(Amount): How do you want to enter the amounts? There could be either three way to entering amounts: 1. One time purchase, 2. Constant amounts over time(Recurring purchase) and 3. Varying amounts over time.
Amortization: Short-term assets will amortize, or spread their value out over their useful life. Amortization refers to capitalizing the value of an intangible asset over time. Here you need to define how long do you want to spread out the values, System will calculate amortization values over time.
How short term assets reflects in various financial statements:
See how the assets reflects in all three main financial statements Profit & Loss statement, Balance Sheet and Cash-flow Statement as follow:
Where does the Current Assets appear in Profit & Loss Statement?
Amortization is the cost as the asset is consumed or used up while generating sales or profits for a company. So in profit & loss statement it would be appear under the section ‘Operating Expenses’
Where does the Current Assets appear in Balance Sheet?
Assets is the important part of balance sheet, There is a separate section for ‘Current Assets’ along with Accounts Receivable, Inventory and Cash under the main section ‘Assets’ in balance sheet as follow:
Where does the Current Assets appear in Cash-flow Statement?
In the Cash Flow, There is a separate row for ‘Depreciation and Amortization’ under the section ‘Net Cash from Operations’.
If you are looking for an option to add long term assets, Click to see how to add long term assets.