Cash and cash equivalents include:
A)assets that have stable long-term value.
B)assets that are short-term and highly liquid and have an original maturity of less than three months.
C)assets that consistently grow in value over the long run.
D)all of the answers are acceptable.

Question

Quizplus · Accepted Answer

Cash and cash equivalents refer to highly liquid assets that are easily converted into cash within three months or less. Examples include Treasury bills, commercial paper, and money market funds. Assets with stable long-term value (choice A) and assets that consistently grow in value over the long run (choice C) do not fall under the category of cash and cash equivalents. Choice D is incorrect because not all answers are acceptable.

Cash and Cash Equivalents Include