Asset
Assets are things owned by a company that have value and can help earn money in the future.
Assets include everything a company owns that has financial value. These resources help the business run and generate income.
Assets are mainly divided into two types:
Current Assets: Can be converted into cash within a year
(cash, bank balance, inventory, receivables)
Non-Current Assets: Long-term assets used for business operations
(buildings, machinery, equipment, goodwill)
Total assets show the overall strength of a company. However, increasing assets is only good if the company is also using them efficiently to generate profits.
Example: If a company owns cash of ₹2 lakh, inventory of ₹3 lakh, and machinery worth ₹5 lakh, its total assets are ₹10 lakh. |