Final answer:
Restricted cash is not reported as a 'Cash equivalent' on the balance sheet, whereas Money orders, Treasury Bills, and Commercial Paper are considered cash equivalents because they are highly liquid and convertible to known amounts of cash.
Step-by-step explanation:
Restricted cash is the correct answer because it is not categorized as a 'Cash equivalent' on the balance sheet. Money orders, Treasury Bills, and Commercial Paper are considered cash equivalents.
Cash equivalents include short-term, highly liquid investments that are readily convertible to known amounts of cash and so near their maturity that they present insignificant risk of changes in value because of changes in interest rates. Typically, the investments included in cash equivalents are those with original maturities of three months or less. Examples of items included in cash equivalents are Treasury Bills, Commercial Paper, and money market funds.
Money orders are similar to cash and are considered to be cash equivalents because they are easily convertible to cash. Treasury Bills are short-term government securities with maturities of one year or less and are also highly liquid. Commercial Paper is an unsecured, short-term debt instrument issued by a corporation, typically for the financing of accounts receivable, inventories and meeting short-term liabilities.
Restricted cash is not classified as a cash equivalent because it refers to money that is reserved for a specific purpose and is not available for immediate or general business use.