While these assets are not physical in nature, they are often the resources that can make or break a company – the value of a brand name, for instance, should not be underestimated.
Depreciation is calculated and deducted from most of these assets, which represents the economic cost of the asset over its useful life.
Such assets classes include cash and cash equivalents, accounts receivable, and inventory.
The main way this is done is through financial ratio analysis.Another interesting aspect of the balance sheet is how it is organized.The assets and liabilities sections of the balance sheet are organized by how current the account is.Assets are on the top, and below them are the company's liabilities and shareholders' equity.It is also clear that this balance sheet is in balance where the value of the assets equals the combined value of the liabilities and shareholders' equity.Cash equivalents are very safe assets that can be readily converted into cash; U. Companies often sell products or services to customers on credit; these obligations are held in the current assets account until they are paid off by the clients.