Arrange the current assets in order of their liquidity:
(A) Cash at Bank
(B) Marketable Securities
(C) Bills receivable
(D) Debtors
Choose the correct answer from the options given below:
Answer & explanation
Correct answer: option 2
The correct answer is Option (2) → (A), (B), (C), (D)
Liquidity means how quickly an asset can be turned into cash without loss.
(A) Cash at Bank — first. It is already cash, so it is the most liquid.
(B) Marketable Securities — second. They can be sold in the market at almost any time.
(C) Bills receivable — third. A bill can be discounted with a bank before its due date, so it turns into cash faster than an ordinary debt.
(D) Debtors — last. The firm has to wait until the customer pays. There is no easy way to cash the debt earlier.
NCERT (2026-27 Edition): “Working Capital … Examples of current assets, in order of their liquidity, are as under. |