Experts i am having a serious doubt
Dear Student
In order to calculate quick assets from current assets it is always necessary to deduct stock and prepaid expenses from current assets in order to arrive at the figure of liquid assets because liquid asset include only those assets which can be converted into cash within a time span of 3 months therefore stock and prepaid expenses are regarded as less liquid .
Stock is always given in the question when we have to find liquid assets from current assets.
The other names of stock that may be used in the question are inventories or merchandise.
Regards
In order to calculate quick assets from current assets it is always necessary to deduct stock and prepaid expenses from current assets in order to arrive at the figure of liquid assets because liquid asset include only those assets which can be converted into cash within a time span of 3 months therefore stock and prepaid expenses are regarded as less liquid .
Stock is always given in the question when we have to find liquid assets from current assets.
The other names of stock that may be used in the question are inventories or merchandise.
Regards