Identify the current asset which has the least liquidity:

The correct answer is Option (4) → Raw materials

• Option (1) Marketable securities — Incorrect. They can be sold in the market at almost any time, so they are the most liquid after cash.

• Option (2) Debtors — Incorrect. The goods are already sold. Only the money has to be collected.

• Option (3) Work in progress — Incorrect. It still has to be finished and sold, but part of the work is already done.

• Option (4) Raw materials — Correct. An asset is more liquid when it can be turned into cash more quickly and without loss of value. Raw materials must pass through every stage: they are made into goods, the goods are sold, and the money is collected from debtors. They are the farthest from cash, so they are the least liquid of the four.