The following current assets are listed in a companys general ledger. The accountant wants to place the

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The following current assets are listed in a company’s general ledger. The accountant wants to place the items in order of liquidity on the balance sheet.
Accounts
Receivable
Certificates of Deposit (six months)
Investment in Stock
Prepaid Rent
Money Market Fund
Petty Cash Fund


Required
Rank the accounts in terms of liquidity. Identify items to be included in the total of cash and explain why the items not included in cash on the balance sheet are not as liquid as cash. Explain how these items should be classified.

Balance Sheet
Balance sheet is a statement of the financial position of a business that list all the assets, liabilities, and owner’s equity and shareholder’s equity at a particular point of time. A balance sheet is also called as a “statement of financial...
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