Accounts receivable is the amount owed to a seller by a customer. As such, it is an asset, since it is convertible to cash on a future date. Accounts receivable is listed as a current asset in the balance sheet, since it is usually convertible into cash in less than one year.
Assets are often grouped into two broad categories: liquid assets and illiquid assets. A liquid asset is one that can be converted into cash quickly with little to no effect on the price received. For example, stocks, money market instruments and government bonds are liquid assets.
Cash equivalents are investments securities that are for short-term investing, and they have high credit quality and are highly liquid. Cash equivalents, also known as "cash and equivalents," are one of the three main asset classes, along with stocks and bonds.
All commodities are assets but all assets may not be commodities. Asset is a very wide term. It includes fixed assets like building, machinery etc.; current assets like commodities, stock and even debtors; investments like in equity shares of another company etc.
An asset is anything of value that can be converted into cash. Assets are owned by individuals, businesses and governments. Examples of assets include: Cash and cash equivalents – certificates of deposit, checking and savings accounts, money market accounts, physical cash, Treasury bills; Real property – land and any structure that is ...
Raw Materials. Raw materials inventory consists of the "stuff" that will get turned into the products you make. It includes truly raw materials, such as wood, sheet metal or plastic, as well as materials and components purchased from suppliers for use in production.
Short Term Deposit Example: For example, Short Term Deposits will often be offered by banks and financial institutions with a fixed rate of interest and maturity date. The depositor of the funds does so with the understanding that the funds will not be available to them until the maturity date of the investment arrives.
What is 'Work-In-Progress (WIP)' Work-in-progress (WIP) is a production and supply-chain management term describing partially finished goods awaiting completion. WIP refers to the raw materials, labor, and overhead costs incurred for products that are at various stages of the production process. WIP is a component of the inventory asset account on the balance sheet.