Question

arrange the following assets in order of liquidity:
closing stock, cash in hand, Bank balance, furniture, goodwill, bills receivable

Answer 1

Explanation:

1. cash in hand
2. bank balance
3. bill receivable
4. closing stock
5. furniture
6. goodwill

Answer 2

Following is the arrangement of the given assets according to their liquidity.

1. cash in hand

2. Bank balance

3. Bills receivable

4. Closing stock

5. Furniture

6. Goodwill

Here, liquidity of assets is the ability to convert an asset into cash. The easier it is to convert the asset into cash, the higher its liquidity will be. That's why cash comes on top of the liquidity list of assets. Bank balance comes in second, as it is easy t withdraw the balance in the bank for cash. Bill receivable can also be discounted from the bank when needed. Stock in hand can be sold but it takes time, the same goes for furniture and goodwill.