Which of the following would not be reported on the balance sheet as a cash equivalent?
A) Money market fund
B) Sixty-day certificate of deposit
C) Six-month Treasury bill
D) Money market savings certificate

Question

Quizplus · Accepted Answer

Cash equivalents are short-term, highly liquid investments that are readily convertible to known amounts of cash and which are subject to an insignificant risk of changes in value. Typically, only investments with original maturities of three months or less qualify. Since a six-month Treasury bill exceeds this three-month criterion, it would not be considered a cash equivalent and thus would not be reported as such on the balance sheet.

Which of the Following Would Not Be Reported on the Balance