Cash Equivalents Flashcards
1
Q
Two characteristics of cash equivalents
A
Is easily convertible for a known amount of
Has an orginal maturity of 3 months or less
2
Q
Examples of cash equivalents
A
Petty cash, money market accounts, saving accounts, cds
3
Q
Excluded from unrestricted (is restricted cash)
A
Compensating balances, postdated check, current or noncurrent restricted cash
4
Q
Restricted cash is
A
Held for a purpose
Not available immediately
Seperate on balance sheet
5
Q
Postage stamp is a
A
Prepaid expense
6
Q
Bank side of recon
A
Balance
+deposits
- checks outstanding
+- errors
7
Q
Book side of recon (ID)
A
ADD
Interest
Deposits not yet recorded on books
8
Q
Book side of recon (WIF)
A
Subtract
Withdrawals not yet on books
Insufficient funds (returned checks)
Fees
9
Q
Deposit in transit
A
Hasn’t cleared bank by end of period
