Table of contents

1. Introduction to Accounting1h 21m
2. Transaction Analysis1h 13m
3. Accrual Accounting Concepts2h 38m
4. Merchandising Operations2h 30m
5. Inventory1h 55m
6. Internal Controls and Reporting Cash1h 16m
7. Receivables and Investments3h 8m
8. Long Lived Assets5h 1m
9. Current Liabilities2h 19m
10. Time Value of Money1h 23m
- Time Value of Money Equations
  35m
- Using Time Value of Money Tables
  47m
11. Long Term Liabilities2h 45m
12. Stockholders' Equity2h 15m
13. Statement of Cash Flows2h 24m
14. Financial Statement Analysis5h 25m
15. GAAP vs IFRS56m

1. Introduction to Accounting

Types of Accounting

Financial Accounting

1. Introduction to Accounting

Types of Accounting

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Multiple Choice

Which of the following investments has the least liquidity?

House

Checking account

Small business

Mutual fund

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Verified step by step guidance

Understand the concept of liquidity: Liquidity refers to how quickly and easily an asset can be converted into cash without significantly affecting its value.

Evaluate each option based on liquidity: A checking account is highly liquid because funds can be accessed immediately. Mutual funds are relatively liquid as they can be sold within a few days. A small business and a house are less liquid because selling them takes time and effort.

Consider the time and effort required to convert each asset into cash: Selling a house typically involves finding a buyer, negotiating, and completing legal processes, which can take weeks or months. Similarly, selling a small business requires significant time and effort.

Compare the liquidity of a house and a small business: While both are less liquid than a checking account or mutual fund, a house is generally considered less liquid because the real estate market can be unpredictable, and the process of selling a house is often more complex.

Conclude that the house has the least liquidity among the options provided, based on the time, effort, and unpredictability involved in converting it into cash.