A cash equivalent is an investment that
A)Is readily convertible to a known amount of cash
B)Is subject to an insignificant risk of changes in value
C)Is within 3 months of its maturity date
D)Is highly liquid
E)All of these

Question

Quizplus · Accepted Answer

A cash equivalent is an investment that is readily convertible to a known amount of cash, is subject to an insignificant risk of changes in value, is within 3 months of its maturity date, and is highly liquid. Therefore, all of these characteristics must be present for an investment to be considered a cash equivalent.

A Cash Equivalent Is an Investment That