Valiant Inc.reported the following amounts: Cash in Bank-chequing account of $18,500, Cash on hand of $500, Postdated cheques received totalling $3,500, and certificates of deposit totalling $124,000.How much should be reported as cash in the balance sheet?

Question

Quizplus · Accepted Answer

Only cash in bank-chequing account and cash on hand should be reported as cash in the balance sheet. Postdated cheques are not considered as cash until they are cashed, and certificates of deposit are considered as investments rather than cash. Therefore, the cash reported in the balance sheet should be $18,500 (cash in bank-chequing account) + $500 (cash on hand) = $19,000.