Which statement is correct?
A)A security that meets the criteria of cash equivalent must be classified as cash such.
B)A security that meets the criteria of cash equivalent can be classified as cash such.
C)A security that meets the criteria of cash equivalent must be presented as cash such.
D)A security that meets the criteria of cash equivalent must be cash.

Question

Quizplus · Accepted Answer

A security that meets the criteria of cash equivalent can be classified as cash equivalent on the balance sheet, but it is not required to be presented as cash. It is still considered a separate asset on the balance sheet, but is highly liquid and easily convertible to cash.

Which Statement Is Correct