Current Asset: $50,000
Inventory: $13,000
Prepaid Expense: $1,000
Working Capital: $30,000

Definition of Current Asset:
Current assets are the assets that a company expects to convert into cash or use up within one year or its operating cycle, whichever is longer. These assets are listed on the balance sheet and are expected to provide economic benefits to the company in the short term.

Explanation of Current Asset:
The current asset of $50,000 represents the total value of assets that are expected to be converted into cash or used up within the next year or operating cycle. It includes cash, accounts receivable, inventory, and prepaid expenses, among others. These assets are crucial for the day-to-day operations of a business and are often used to pay off short-term liabilities.

Definition of Inventory:
Inventory refers to the goods that a company holds for production, sale, or distribution in the normal course of its business operations. It can include raw materials, work-in-progress, and finished goods.

Explanation of Inventory:
The inventory value of $13,000 represents the cost of goods that the company currently has in stock and plans to sell in the future. Inventory is an important asset for businesses that engage in buying and selling goods. It allows them to meet customer demand and generate revenue. The value of inventory can fluctuate due to factors such as purchases, sales, and changes in market demand.

Definition of Prepaid Expense:
Prepaid expenses are payments made by a company for goods or services that have not yet been received or used. These expenses are recorded as assets on the balance sheet and are gradually recognized as expenses over time.

Explanation of Prepaid Expense:
The prepaid expense of $1,000 represents the amount that the company has paid in advance for goods or services that it has not yet received. This could include items such as insurance premiums, rent payments, or annual subscriptions. As time passes or services are rendered, these prepaid expenses are gradually recognized as expenses on the income statement.

Definition of Working Capital:
Working capital is a measure of a company's short-term liquidity and its ability to cover its current liabilities with its current assets. It represents the funds available to a company to meet its day-to-day operational expenses.

Explanation of Working Capital:
The working capital of $30,000 represents the excess of current assets over current liabilities. It indicates the financial health of a company and its ability to cover short-term obligations. A positive working capital indicates that the company has enough liquid assets to meet its short-term liabilities, while a negative working capital suggests that the company may face liquidity challenges.

Summary:
In summary, the current asset of $50,000 represents the total value of assets that are expected to be converted into cash or used up within the next year. The inventory of $13,000 represents the cost of goods that the company currently has in stock. The prepaid expense of $1,000 represents the amount paid in advance for goods or services. Lastly, the working capital of $30,000 indicates the excess of current assets over current liabilities and reflects the company's short-term liquidity.

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