[Verse 1] Let me tell you 'bout the balance sheet today Where assets live and liabilities stay But here's the key to reading it just right You gotta know the timing, day and night Current means it's coming due real soon Within a year, like phases of the moon Non-current takes a longer time to flow More than twelve months, that's what you need to know [Chorus] Current flows within a year or less Cash and inventory, accounts to collect Non-current stays for longer than that Buildings, bonds, and equipment where it's at One year line divides them clean Current versus non-current, know what they mean [Verse 2] On the asset side, let's break it down Current assets keep the business sound Cash in hand and money in the bank Inventory waiting to be sold, give thanks Accounts receivable, customers will pay Within the year, they're current all the way But buildings, land, and trucks that last for years Non-current assets, that much is clear [Chorus] Current flows within a year or less Cash and inventory, accounts to collect Non-current stays for longer than that Buildings, bonds, and equipment where it's at One year line divides them clean Current versus non-current, know what they mean [Verse 3] Now liabilities tell another tale What the company owes without fail Current liabilities must be paid soon Accounts payable, wages, coming due Short-term loans and taxes that are owed Current classification, that's the code But mortgages and bonds that stretch beyond Non-current liabilities respond [Bridge] Why does this matter, you might ask It's more than just an accounting task Liquidity and risk, that's what we see Current ratios show liquidity Working capital tells us if they're strong Current assets minus current wrongs Non-current shows the long-term view Strategic investments coming through [Chorus] Current flows within a year or less Cash and inventory, accounts to collect Non-current stays for longer than that Buildings, bonds, and equipment where it's at One year line divides them clean Current versus non-current, know what they mean [Outro] So when you read that balance sheet today Remember how to classify the way One year is the magic line to see Current versus non-current, the key to CFA
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