BUAD 803 ASSIGNMENT 1

Difference between the following:

-Current and non-current assets

-Tangible and Intangible assets

-Subsidiary books and Source Documents

1. Current and Non-current Assets:

Current Assets: These are assets that are expected to be converted into cash or used up within one year
or the normal operating cycle of a business. Examples include cash, accounts receivable, inventory, and
short-term investments.

Non-current Assets: Also known as long-term assets, these are assets held for a longer period, typically
more than a year. They are not expected to be converted into cash or consumed within the normal
operating cycle. Non-current assets include property, plant, equipment, long-term investments, and
intangible assets.

2. Tangible and Intangible Assets:

Tangible Assets: These are physical assets with a definite physical substance that can be touched, seen,
and quantified. Examples include land, buildings, machinery, equipment, and vehicles.

Intangible Assets: These are non-physical assets lacking a physical presence but hold significant value to
a business. They include intellectual property like patents, copyrights, trademarks, goodwill, brand
recognition, and software.

3. Subsidiary Books and Source Documents:

Source Documents: These are original documents providing evidence of a transaction, such as invoices,
receipts, purchase orders, sales contracts, bank statements, and vouchers. They are the initial records
that serve as proof of a business transaction.

Subsidiary Books: These are books or registers used to record transactions systematically based on their
nature. Subsidiary books include journals like the sales journal, purchases journal, cash book, and ledger.
They help in classifying and summarizing transactions before posting them to the general ledger.

In summary, the distinctions lie in the nature, timing, and purpose of these assets and record-keeping
methods within accounting and business operations.