- CFA Exams
- CFA Level I Exam
- Topic 4. Financial Statement Analysis
- Learning Module 3. Analyzing Balance Sheets
- Subject 5. Ratios and Common-Size Analysis
CFA Practice Question
The least liquid current asset is ______.
A. marketable securities
B. accounts receivable
C. inventory
Correct Answer: C
Inventory is the least liquid current asset and the most likely source of losses. Therefore, inventory is excluded from current assets in computing the quick ratio.
User Contributed Comments 7
| User | Comment |
|---|---|
| danrow | Which one of those is the most liquid asset? Marketable securities? |
| surob | Yes |
| Drzewes | If it was as one of the possibilities, would prepaid expenses go as the least liquid? |
| Psalm119 | yes. i believe prepaid expenses would be less liquid in comparison to inventory. |
| reganbaha | cash |
| birdperson | cash is most liquid |
| ascruggs92 | A/R can be factored (sold for money) so they are pretty liquid |