What is the difference between a current asset and property,plant and equipment? How does separating these assets in a classified balance sheet help people understand the financial position of a corporation? Below are 2 answer, reply to each answer that you are agree or disagree with them, why ?

1. Assets kept for less than a year are referred to as current assets. The majority of the current assets come from running the firm. For instance, take prepaid expenses, inventory, and accounts receivable. Due to their nature, a select number of current assets, such as short-term investments and marketable securities, are designated as current. Although current assets are valued using accounting standards, they are not subject to annual depreciation. Equipment, plant, and real estate make up the company's long-term fixed assets. They are the foundational resources of the company and are used in operations to produce income. They last longer than a year and at longer intervals. PPE is amortized based on the asset's useful life. All current assets are listed and classified in the current assets section of a firm's balance sheet or statement of financial position, and plant, property, and equipment are listed and categorized in the long-term assets section. This division and classification of assets into current assets and long-term assets (Property, Plant, and Equipment) gave users of financial statements information about liquidity and used to make ratio analyses like current ratio, quick ratio, assets turnover ratio, etc., and clarity of potential asset base to make financial analysis. Additionally, this classification gives users of financial statements valuable information for analysis and decision-making requirements. 2. Current assets are the assets which are held for less than a year. Most of the current assets are generated out of the operating business. Examples are short term investments, marketable securities, etc. Current assets are not subject to annual depreciation but are valued based on accounting principles. Property, plant and equipment are the long term assets of the firm which are fixed in nature. PPE is depreciated based on the useful life of the asset. Separating these assets help in understanding working capital requirements since current assets are part of working capital, help in calculating ratios to understand them better. Current assets indicate the liquidity of the firm that is how much current assets are available to meet short term obligations.