Current Assets are assets held by a business that are typically liquidated and converted into cash within one year or one operating cycle, whichever is longest. This includes cash, accounts receivable from customers, and inventory. Current Liabilities on the other hand, are debts that a company must pay within one year or within one operating cycle. Common current liabilities are accounts payable, wages payable, income tax payable, and bank loans due in less than one year. Knowing your company’s current assets and liabilities can be a key indicator of your financial health and help you better understand the short-term decisions you need to make.