Question

Identify cash equivalents from the listed items.

1) Treasury bills
2) Accounts receivable
3) Inventory
4) Land

Answer 1

Treasury bills are considered to be cash equivalents.

Step-by-step explanation:

Cash equivalents are highly liquid assets that can be easily converted into cash within a short period of time. They are considered as near-cash items and are included in the current assets section of the balance sheet. From the listed items, the cash equivalent is Treasury bills. Treasury bills are short-term debt securities issued by the government, and they are highly liquid and easily tradable.