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Jun 27, 2024 · A liquid asset is an asset that can easily be converted into cash within a short amount of time. Liquid assets generally tend to have liquid markets with high levels of...
Nov 11, 2024 · In accounting, liquid assets are assets that can be easily converted into cash without a significant impact on their market value. They are valuable for businesses as they provide rapid access to required funds to cover short-term obligations or unexpected expenses.
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.
Jul 2, 2024 · What is a Liquid Asset? A liquid asset is any asset that is readily convertible into cash within a short period of time, and which suffers no loss in value as a result of the conversion. Convertibility is assisted by the presence of a large market in which there are many participants, and in which it is easy to transfer ownership from the buyer ...
Liquid assets are used to calculate the liquidity or quick ratio of a firm. In theory and practically liquid assets are more liquid and quickly convertible to cash as compared to current assets. Liquid assets are also known as quick assets. >Related Long Quiz for Practice Quiz 20 – Current Assets.
Definition: A liquid asset is a resource that can easily be converted into cash and used to pay for goods and services or pay off liabilities. Assets that can be readily traded for goods and services are also considered to be liquid even if they can’t be converted into cash.
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Liquid assets are either cash, cash equivalents or they can be converted into cash at very short notice. They are also referred to as Quick Assets. Quick assets can be calculated as [Current Assets – Inventory – Prepaid Expenses].
