Which One of the Following Represents the Most Liquid Asset

question 53

Multiple Choice

Which one of the following represents the most liquid asset?

• A)$100 account receivable that is discounted and collected for $96 today
• B)$100 of inventory which is sold today on credit for $103
• C)$100 of inventory which is discounted and sold for $97 cash today
• D)$100 of inventory that is sold today for $100 cash
• E)$100 accounts receivable that will be collected in full next week

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Definitions:

Gross Pay

The total amount of an employee's earnings before any deductions are made, such as taxes and retirement contributions.

Biweekly Paycheck

A payroll schedule where employees receive wages every two weeks, resulting in 26 paychecks per year.

Checking Account

An account at a bank that allows a customer to deposit money and make withdrawals from the funds on deposit using a paper check or electronic transfer.

Flat Rate

A pricing strategy where a single fixed fee is charged for a service, regardless of usage or time.