Cash and cash equivalents, as used on the statement of cash flows, consist of:

Question

Quizplus · Accepted Answer

Cash and cash equivalents include cash and short-term, highly liquid investments such as treasury bills, certificates of deposit, and commercial paper. Only including currency and bank accounts (A and B) would not accurately reflect all of the cash available to the company, while including all investments (C) may not accurately reflect the liquidity of the assets.

Cash and Cash Equivalents, as Used on the Statement of Cash