Why is cash regarded as more important than inventories


Response to the following problem:

The typical business outside the service sector has about 50 per cent more of its resources tied up in inventories than in cash, yet there is no call for a ‘inventories flow statement' to be prepared. Why is cash regarded as more important than inventories.

If possible, please give examples to better understand your response.

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Accounting Basics: Why is cash regarded as more important than inventories
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