Explain current assets, loans and advances.

Explain current assets, loans and advances.


Current Assets : are the assets which get generated during the course of operations and are likely to be converted in the form of cash or getting utilized during the normal operational cycle of the business within a short span of time of one year. Example: Sundry Debtors, Prepaid expenses, Stock etc.

Loans which comes under long term liabilities. It may consist of long term loan borrowed from banks or financial institutions and are paid off over a longer span of time say 5-10 years.

Advances are the sums paid or received before an obligation is fulfilled. This comes under current liabilities. Example: Advance received from customers and income received in advance.
Explain miscellaneous expenditures & profit and loss account debit balance
Miscellaneous Expenditures, Profit and Loss Account debit balance : As per the business entity principle…
Explain Ratio Analysis and its advantages.
Ratio analysis is a systematic technique of analysis and interpretation of financial statements…
What are the limitations of Ratio Analysis?
The basic limitation of ratio analysis is that it may be difficult to find a basis for making the comparisons…
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