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    • Liquid Asset - Definition, Example, Importance, Balance
      • Liquid assets ensure a company’s ability to meet its immediate financial obligations and operating expenses. In addition, the assets serve as the company’s protection from unforeseen adverse events, such as a recession or a sudden decline in demand for the company’s products or services.
      corporatefinanceinstitute.com/resources/accounting/liquid-asset/
  1. Jun 27, 2024 · A liquid asset is an item of future economic benefit to a company that can easily be exchanged for cash. On the other hand, illiquid assets are more difficult to sell.

    • Cash. Includes physical money (local and foreign currency) as well as the savings account and/or current account balances.
    • Cash equivalents. Cash equivalents are investment securities with a maturity period not exceeding a year. Examples include treasury bills, treasury bonds, certificates of deposit, and money market funds.
    • Marketable securities. Stocks, bonds, and exchange traded funds (ETFs) are examples of marketable securities with a high degree of liquidity. They can be sold easily and it usually takes just a few days to receive the cash from their sale.
    • Accounts receivable. Money owed to a business by its customers for goods and services provided makes up accounts receivable. The liquidity of accounts receivable varies.
  2. Jan 22, 2023 · In corporate finance, liquid assets are those that can be used to pay off debts in a hurry. The most common examples of liquid assets are cashon-hand or deposited in a bank – and...

    • Claire Boyte-White
  3. What is a Liquid Asset? A liquid asset is cash on hand or an asset other than cash that can be quickly converted into cash at a reasonable price. In other words, a liquid asset can be quickly sold on the market without a significant loss of its value.

  4. Apr 22, 2022 · Liquid assets include cash and anything that can be converted into cash quickly and easily. Learn how they compare with other assets and why they're important for...

  5. Learn about liquid assets, management, and their importance for businesses. Explore examples and the differences between liquid and non-liquid assets.

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  7. Oct 28, 2024 · Why are liquid assets important? Liquid assets provide you with cash when your business needs it. This cash could cover operational costs such as supplier invoices, employee wages, insurance payments, and ongoing bills. More importantly, liquid assets are invaluable in providing a safety buffer.

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