An example of a current asset is?

Cash is classified as a current asset because it is the most liquid form of asset a business can hold. Current assets are defined as assets that are expected to be converted into cash or used up within one year or within the business's operating cycle, whichever is longer. Cash is the primary currency for conducting operations and meeting short-term obligations, making it essential for daily transactions.

On the other hand, machinery and real estate represent long-term investments. They are considered fixed assets since they are typically not intended for immediate liquidation and are expected to provide value over a long period. Long-term investments also fall outside the current asset category, as they are not anticipated to be converted into cash within the short term. Therefore, cash stands out as the only current asset among the given options.