Question

The following information is available for Birch Company at December 31:

Money market fund balance $2,790
Certificate of deposit maturing June 30 of next year $10,000
Postdated checks from customers $1,475
Cash in bank account $21,430
NSF checks from customers returned by bank $650
Cash in petty cash fund $200
Inventory of postage stamps $24
U.S. Treasury bill purchased on December 15
and maturing on February 28 of following year $5,000

Based on this information, Birch Company should report Cash and Cash Equivalents on December 31 of:

a. $29,420
b. $41,345
c. $31,345
d. $39,420
e. $38,770

Answer 1

Cash and cash equivalents = $29420

Step-by-step explanation:

Cash = $21430 + $200 = $21630

Cash equivalents= money market fund + Treasury bill = 2790 + 5000 = $7790.

Cash & cash equivalents at Dec 31 = 21630 + 7790 = $29420.