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Current Vs. Noncurrent Asset Or Liability

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-What differentiates a current asset or liability from a noncurrent asset or liability?
-Why are accounts receivable listed before inventory on the balance sheet?
-Explain what effect the payment of dividends has on net worth?
-Explain what effect the repurchase of stock from shareholders has on net worth?

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Solution Summary

This solution discusses various asset and liability topics, including current and noncurrent assets and liabilities, inventory, dividends, and stock repurchases. Includes 2 references.

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-What differentiates a current asset or liability from a noncurrent asset or liability?
A current asset is an asset that is received (collected upon) or can be converted to cash within one year's time. A noncurrent asset is also called a permanent or fixed asset. It is an asset that isn't readily converted to cash. Current assets include cash, checking/savings accounts, accounts receivable, inventory, and other items that are highly liquid. A noncurrent asset is something that can't be converted quickly. A machine, land, and other types of property are noncurrent (fixed) assets. The same holds true for liabilities. Liabilities that are due within one year's time are current liabilities. Accounts ...

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