Cash equivalents have each of the following characteristics except:
A)Little risk of loss.
B)Highly liquid.
C)Maturity of at least 3 months.
D)Short-term.

Question

Quizplus · Accepted Answer

Cash equivalents must have a maturity of 3 months or less, as stated by the SEC in their definition of cash and cash equivalents. Therefore, choice C is incorrect. Cash equivalents should have little risk of loss, be highly liquid, and be short-term in nature.

Cash Equivalents Have Each of the Following Characteristics Except