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A firm really should be capable of promote or liquidate a cash equivalent immediately on demand from customers without the need of anxiety or material decline to the solution. Cash equivalents are very low threat property without the need of significant selling price fluctuations.
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The underside Line Cash and cash equivalents are probably the most liquid recent belongings on an organization's stability sheet. The assortment of financial products that comprise the balance of the classification ordinarily have maturities of ninety times or fewer, are simply convertible to cash, lower chance, and need to not have limitations that limit their liquidity.
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