In the cash flow statement, cash is defined as literal cash on hand or on demand deposit plus cash equivalents.

Question

Quizplus · Accepted Answer

Cash equivalents are short-term investments that are highly liquid and can be converted into cash quickly, such as treasury bills, certificates of deposit, and money market funds. Therefore, they are included in the definition of cash for the purpose of the cash flow statement.

In the Cash Flow Statement, Cash Is Defined as Literal