Assets are properties owned and controlled by a business. Current assets are short-term in nature, such as cash and inventories. Non-current assets are long-term; for example, land, building, and equipment. Liabilities are obligations to other parties, such as payable to suppliers, loans from banks, bonds issued, etc.

Assets, liabilities, and equity are the components of a balance sheet. Here’s the breakdown: Total assets: What your business owns. Assets are resources used to produce revenue and have a future economic benefit. Liabilities: Amounts your business owes to other parties. Liabilities include accounts payable and long-term debt.

There are five sections on a balance sheet: current assets, non-current assets, current liabilities, non-current liabilities, and shareholders' equity. The terms "current" and "non-current" mean the same thing as short-term and long-term, respectively, and are used interchangeably.

Examples of assets: Cash, inventory, building, furniture, and accounts receivable Examples of liabilities: Loans, accounts payable, sales tax payable, and debts