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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...
- 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.
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.
Nov 11, 2024 · Liquid assets are essential for evaluating a business's liquidity, which is its ability to pay off current liabilities without selling long-term assets or investments. Importance of Liquid Assets for Small Businesses.
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 cash – on-hand or deposited in a bank...
- Claire Boyte-White
Oct 14, 2024 · Key Takeaways. A liquid asset is either available cash or an instrument that can easily be converted to cash. Liquid assets are perceived as being essentially identical to...
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Jul 7, 2024 · Liquid asset refers to a financial resource or asset that can be converted into liquid cash quickly with minimum value on its value. Liquid assets hold an economic value for an individual, corporation, or government.