Cash equivalents are short-term, highly liquid investments that are readily convertible to known amounts of cash and have original maturities of three months or less. Examples include treasury bills, commercial paper, and money market funds purchased with excess cash. Therefore, all of the given options are correct.

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Cash Equivalents Are

Question 22

Multiple Choice

Cash equivalents are

A) treasury bills, commercial paper, and money market funds purchased with excess cash.
B) investments with original maturities of three months or less.
C) readily convertible to known amounts of cash.
D) all of these.

Correct Answer: