Which of the following items is treated as a cash equivalent? a.Commercial paper with a six-month...

Which of the following items is treated as a cash equivalent?

a.Commercial paper with a six-month maturity when purchased and four months until maturity at the balance sheet date

b.Investments in corporate bonds that have five years until maturity when they are purchased

c.Investment in corporate stocks that management intends to sell within three months after the balance sheet date

d.Money market funds that can be obtained overnight from a bank or brokerage firm

Solutions

Expert Solution

d.money market funds that can be obtained overnight from a bank or brockrage firm

Explanation: cash and cash equivalents are highly liquid and easliy converted into cash without much change its value.Money market fund provides highly liquid capacity and convert easily in cash.

ekkarill92 answered 1 year ago

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