[amp_mcq option1=”2, 3, 1, 4″ option2=”3, 4, 1, 2″ option3=”1, 4, 2, 3″ option4=”3, 1, 4, 2″ correct=”option3″]<\/p>\n
The correct answer is: C. 1, 4, 2, 3<\/strong><\/p>\n Liquidity is the ability of an asset to be converted into cash quickly and easily without loss of value. Assets can be ranked in order of liquidity, with the most liquid assets being those that can be converted into cash most quickly and easily.<\/p>\n In the given question, the assets are:<\/p>\n Therefore, the correct order of liquidity is:<\/p>\n Option A is incorrect because it lists the building before the cash. The building is a fixed asset that cannot be easily converted into cash, while cash is the most liquid asset.<\/p>\n Option B is incorrect because it lists the stock before the debtors. The stock is inventory that a company holds for sale, while debtors are amounts owed to a company by its customers. Debtors are considered to be liquid assets because they can be converted into cash relatively quickly by collecting the debts.<\/p>\n Option D is incorrect because it lists the debtors before the cash. The debtors are amounts owed to a company by its customers. They are considered to be liquid assets because they can be converted into cash relatively quickly by collecting the debts. However, cash is the most liquid asset because it can be converted into any other asset or good immediately.<\/p>\n","protected":false},"excerpt":{"rendered":" [amp_mcq option1=”2, 3, 1, 4″ option2=”3, 4, 1, 2″ option3=”1, 4, 2, 3″ option4=”3, 1, 4, 2″ correct=”option3″]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[85],"tags":[],"class_list":["post-51951","post","type-post","status-publish","format-standard","hentry","category-accounting","no-featured-image-padding"],"yoast_head":"\n\n
\n