Which term is the total of fixed assets and net current assets?

Which term is the total of fixed assets and net current assets?

• A. Capital
• B. Net Current Assets/Working Capital
• C. Net Assets
• D. Current Assets

Answer: (C)

This asks you to connect what the business owns outright with what it has in the short term. Net current assets are the difference between current assets and current liabilities, so when you add fixed assets to net current assets you’re summing all the long-term and the net short-term resources the business controls. In GCSE business terms, that total is called net assets, which is also what the owners’ funds (capital) support. So fixed assets plus net current assets equals net assets. Net current assets describe only short-term liquidity (current assets minus current liabilities), not the full asset base. Current assets are just part of what the business owns, not including fixed assets. Capital can be a synonym for net assets in some contexts, but the specific sum described in the question is defined as net assets.

This asks you to connect what the business owns outright with what it has in the short term. Net current assets are the difference between current assets and current liabilities, so when you add fixed assets to net current assets you’re summing all the long-term and the net short-term resources the business controls. In GCSE business terms, that total is called net assets, which is also what the owners’ funds (capital) support. So fixed assets plus net current assets equals net assets.

Net current assets describe only short-term liquidity (current assets minus current liabilities), not the full asset base. Current assets are just part of what the business owns, not including fixed assets. Capital can be a synonym for net assets in some contexts, but the specific sum described in the question is defined as net assets.