Final answer:
Checks received from customers are indeed considered to be cash in a company's accounting records. They are quickly convertible to cash and recorded under the cash or cash equivalents account, though there is a risk of non-payment until they clear. Therefore, the given statement is TRUE.
Step-by-step explanation:
True, checks received from customers are considered to be cash in the company's books. This is because checks are a form of negotiable instrument that can be quickly and easily converted into cash, making them effectively the same as cash for accounting purposes. Companies record these checks as cash in their accounting records under the cash or cash equivalents account. However, it is important to note that there is a small risk associated with accepting checks because they might bounce due to insufficient funds in the payer's account. Until the check clears and the funds are deposited into the company's bank account, there is always a slight possibility of non-payment. Accounting processes often include a protective step called bank reconciliation to ensure all cash transactions are accurately reflected in the company's financial statements.