A Checking Account with $500 Is

question 262

Multiple Choice

A checking account with $500 is:

• A)more liquid than a person's new car.
• B)less liquid than a checking account with $1,000.
• C)as liquid as a stock share with a $500 value.
• D)less liquid than a house with a market value of $250,000.

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Definitions:

Asset Account

An account that records tangible or intangible items owned by a business which have value.

Liability Account

An accounting record that captures the amounts a company owes to creditors or other parties, reflecting the company's future obligations.

General Ledger

The comprehensive set of accounts that summarizes all transactions occurring within an organization, serving as the foundation for financial reporting.

Subsidiary Ledger

A detailed ledger that contains the individual accounts supporting a specific general ledger summary account.