Practice Quiz

CLEP Accounting

Category - Accounting

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Bertha has the following accounts:

Accounts Receivable $10,000
Land $20,000
Cash $22,000
Intangible Assets $12,500
Inventory $33,000
Equipment $99,000
Prepaid Expenses $10,000

Based on this information, what is the amount of Bertha’s quick assets?
  1. $206,500
  2. $65,000
  3. $60,000
  4. $32,000
  5. $42,000
Explanation
Answer - D - The quick assets listed in the accounts total $32,000 and include Cash and Accounts Receivable.

Key Takeaway: Quick assets are cash and those assets that can be quickly converted to cash. This would include cash accounts, marketable securities, and accounts receivable.
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