This refers to the assets’ ability to be converted into cash. According to this classification, assets are classified into short-term or current and long-term or fixed. 

Current

These are easily converted into cash within a year and include:

• Cash
• Office supplies
• Inventory
• Short-term deposits
• Account receivables

Fixed

These items can’t be easily converted into cash and include:

• Land
• Buildings
• Machinery
• Equipment
• Trademarks
• Patents