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time remaining 39 minutes 13 seconds00:39:13 item 19 time remaining 39 minutes 13 seconds00:39:13 the following information is available for birch company at december 31: cash in registers $ 2,790 investment maturing in 9 years $ 10,000 accounts receivable $ 1,475 cash in bank account $ 21,430 accounts payable $ 650 cash in petty cash fund $ 200 inventory of postage stamps $ 24 u.s. treasury bill maturing in 15 days $ 5,000 based on this information, birch company should report cash and cash equivalents on december 31 of: multiple choice $38,770 $31,345 $41,345 $29,420 $39,420

Sagot :

Tundexi

Based on the give accounting information, Birch company should report cash and cash equivalents on December 31 of $29,420.

What is known as cash and cash equivalents in finance?

The term "cash and cash equivalents" means the line item on the balance sheet that reports the value of a company's assets that are cash or can be converted into cash immediately. These cash equivalents include bank accounts and marketable securities which are debt securities with maturities of less than 90 days.

But often times, the cash equivalents do not include equity or stock holdings because they can fluctuate in value. The computation of the Cash & Cash Equivalents is shown as below:

Cash & Cash Equivalents = Money market fund balance + Cash in bank account + Cash in petty cash fund + U.S. Treasury bill

Cash & Cash Equivalents = $2,790 + $21,430 + $200 + $5,000

Cash & Cash Equivalents = $29,420

Therefore, the Option D is correct.

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