A bond may or may not be a current asset depending on its time to maturity. A current asset is any asset that will provide an economic benefit for or within one year. As such, bonds with maturities of a year or less, such as US Treasury Bills, are considered short-term investments and are current assets. Most other types of bonds will stay on a company’s balance sheet for longer than a year, making them non-current assets.
Are Bonds Current Assets FAQs
What is a current asset?
A current asset is an asset that will provide economic value within 1 year, whereas a fixed asset is a long-term asset that will provide economic value beyond 1 year.
Are bonds current assets?
Bonds are not typically a current asset, unless the time to maturity is less than 1 year.
What types of bonds are current assets?
Bonds with maturities less than one year, such as US Treasury Bills, are considered current assets.
What is the difference between a current asset and a fixed asset?
Fixed assets have a much longer lifespan than current assets, which are only ever short-term.
True Tamplin is a published author, public speaker, CEO of UpDigital, and founder of Finance Strategists.
True is a Certified Educator in Personal Finance (CEPF®), author of The Handy Financial Ratios Guide, a member of the Society for Advancing Business Editing and Writing, contributes to his financial education site, Finance Strategists, and has spoken to various financial communities such as the CFA Institute, as well as university students like his Alma mater, Biola University, where he received a bachelor of science in business and data analytics.