Current assets and liabilities are those that will be converted into cash or used up within one year or less. These include items such as accounts receivable, inventory, prepaid expenses, short-term investments, and current portion of long-term debt. On the other hand, long-term assets and liabilities refer to those that will not be liquidated or used up within a one year period. Examples of these would include fixed assets such as real estate and machinery as well as long-term investments and bonds.

The main difference between current and long-term is their liquidity. Current assets are easily converted into cash while long-term ones require more time in order to do so due to the fact that they have longer useful lives which means they must generate returns over an extended period of time before being sold off. This also impacts how companies finance their operations since current liabilities can typically be paid off with ease while long term ones usually require additional financing sources (e.g., equity or debt).