Rank the Following Items in Terms of Most Liquid to Least

question 105

Multiple Choice

Rank the following items in terms of most liquid to least liquid.

• A) checkable deposits, cash, an office building your father owns
• B) cash, credit card, money market mutual funds, checkable deposits,
• C) cash, checkable deposits, savings deposits, an office building your father owns
• D) cash, Microsoft stock certificates you own, checkable deposits

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Definitions:

Absorption Costing

A cost accounting method that includes all manufacturing costs, including both fixed and variable, in the cost of a product.

Contribution Format

A type of income statement layout that separates variable costs from fixed costs, highlighting the contribution margin.

Absorption Costing

A technique in cost accounting that incorporates all costs of production, including fixed and variable, into the valuation of inventory and cost of goods sold.

Variable Costing

An accounting method that includes only variable production costs as product costs, treating fixed manufacturing overhead as an expense of the period in which it is incurred.