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  1. Jun 27, 2024 · Accounts receivable are a controversial type of liquid asset. On one hand, a company has a legal claim to cash that is due to them often as part of their business operations.

    • 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. Aug 8, 2024 · Because accounts receivable is a current asset, it contributes to a company's liquidity or ability to cover short-term obligations without additional cash flows.

  3. Liquid assets, however, are the assets that can be easily, securely, and quickly exchanged for legal tender. Your inventory, accounts receivable, and stocks are examples of liquid assets — things you can quickly convert to hard cash.

  4. Jan 22, 2023 · In addition to cash and other liquid assets, this category includes inventory and accounts receivable. While these assets cannot be liquidated on a moment's notice, they generally are...

    • Claire Boyte-White
  5. And accounts receivable always comes before inventory, because the accounting consensus is that receivables are more liquid. A basic measure of company liquidity known as the quick...

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  7. Mar 14, 2024 · A liquid asset is an asset that can be readily converted to cash without losing its market value. How readily an asset can be converted to cash depends on a few different factors: A large pool of potential buyers. Predictable or stable market price. Quick conversion into cash. Clear and established method for transfer of ownership.

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