If marketable securities increase,then cash should usually decrease by a similar amount,since cash was probably used to purchase the securities.An exception to this is:
A)when the company paid through a check.
B)when the marketable securities are purchased through a broker.
C)when the company incurred debt or traded an asset for the securities.
D)when the transaction was not recorded in the books of accounts.

Question

Quizplus · Accepted Answer

If the company incurred debt or traded an asset for the securities, then the increase in marketable securities would not have been directly funded by cash, and therefore cash would not necessarily decrease by a similar amount.

If Marketable Securities Increase,then Cash Should Usually Decrease by a Similar