Quick assets are defined as:
A) Cash, noncurrent receivables, and prepaid expenses.
B) Accounts receivable, inventory, and prepaid expenses.
C) Cash, inventory, and current receivables.
D) Cash, short-term investments, and current receivables.
E) Cash, short-term investments, and inventory.

Question

Quizplus · Accepted Answer

Quick assets are assets that can quickly and easily be converted to cash. The best choice from the given options is D, which includes cash, short-term investments, and current receivables. Noncurrent receivables (option A) and inventory (options B and C) may take longer to convert to cash and are not considered quick assets. Option E includes short-term investments and inventory, which may take longer to convert to cash than current receivables, making it less preferable than option D.

Quick Assets Are Defined As