What is a key characteristic of current assets?

A key characteristic of current assets is that they can be easily converted into cash. This liquidity is essential for a business as it indicates the company's ability to meet short-term obligations and manage its day-to-day operations. Current assets typically include cash, accounts receivable, and inventory, all of which are expected to be converted into cash or used up within one year. This aspect is particularly crucial for maintaining operational efficiency and financial health, as it allows businesses to cover immediate expenses and invest in opportunities as they arise.

In contrast, the other characteristics highlighted in the choices do not apply to current assets. For example, the notion that they have an indefinite useful life pertains more to long-term assets, which are depreciated over their useful life. The option stating that they are all tangible items does not hold true, as current assets can also include intangible items like accounts receivable. Finally, the requirement for assets to be held for more than one year is a defining feature of long-term assets rather than current ones, which specifically refer to assets expected to be liquidated or used within one year.