Cash And Cash Equivalents

Question 1

What is a cash equivalent

Answer 1

A security that is easily converted into cash with an original maturity of 90 days or less

Question 2

A cash equivalent security is both

Answer 2

Easily convertible into a known amount of cash (Highly Liquid)
Original maturity of 3 months or less from the date of purchase

Question 3

Items excluded from cash

Answer 3

Compensating balance - Legally restricted
Postdated checks or NSF - receivable
Overdraft Protection
Restricted cash
Current - restricted for current asset/liab
Non-Current - Restricted for non current asset/liab
Postage

Question 4

if overdraft occurs at two dif banks what do?

Answer 4

Show positive as asset and the negative as a current liability

Question 5

if overdraft occurs at same bank, what to do?

Answer 5

net the balances, if positive, show as cash, if negative, show as current liability

Question 6

Profit and loss statement also called

Answer 6

Statement of earnings and comprehensive income

Question 7

Other Comprehensive Income DENT stands for:

Answer 7

Derivative cash flow hedge gain/loss
Exces adj. of pension PBO and FV of plan assets at YE
Net unrealized holding gains (AFS) arising during period
Translation adjustment of foreign currency

Question 8

Comprehensive income includes:

Answer 8

Net Income + DENT