Managerial Accounting
7th Edition
ISBN: 9781337116008
Author: Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger
Publisher: South Western Educational Publishing
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Question
Chapter 14, Problem 1DQ
To determine
Explain the cash equivalents. Also, explain the manner in which the cash equivalents are treated while preparing the statement of cash flows.
Expert Solution & Answer
Explanation of Solution
Cash Equivalents:
Cash equivalents are treated as cash in a company. The investments which are highly liquid in nature are termed as cash equivalents. These include treasury bills, commercial papers.
The cash equivalents can be easily converted in cash. Hence, firms invest their surplus cash in these short-term securities. The
Due to the highly liquid nature, the cash equivalents are considered as cash in preparing the statement of cash flows.
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Chapter 14 Solutions
Managerial Accounting
Ch. 14 - Prob. 1DQCh. 14 - Prob. 2DQCh. 14 - Of the three categories on the statement of cash...Ch. 14 - Prob. 4DQCh. 14 - Why is it better to report the noncash investing...Ch. 14 - Prob. 6DQCh. 14 - Prob. 7DQCh. 14 - Explain how a company can report a loss and still...Ch. 14 - In computing the periods net operating cash flows,...Ch. 14 - Prob. 10DQ
Ch. 14 - In computing the periods net operating cash flows,...Ch. 14 - Explain the reasoning for including the payment of...Ch. 14 - What are the advantages in using worksheets when...Ch. 14 - Prob. 14DQCh. 14 - Cash inflows from operating activities come from...Ch. 14 - Prob. 2MCQCh. 14 - Prob. 3MCQCh. 14 - Sources of cash include a. profitable operations....Ch. 14 - Uses of cash include a. cash dividends. b. the...Ch. 14 - Prob. 6MCQCh. 14 - Prob. 7MCQCh. 14 - Which of the following adjustments to net income...Ch. 14 - An increase in accounts receivable is deducted...Ch. 14 - An increase in inventories is deducted from net...Ch. 14 - The gain on sale of equipment is deducted from net...Ch. 14 - Which of the following is an investing activity?...Ch. 14 - Which of the following is a financing activity? a....Ch. 14 - Prob. 14MCQCh. 14 - A worksheet approach to preparing the statement of...Ch. 14 - In a completed worksheet, a. the debit column...Ch. 14 - Prob. 17BEACh. 14 - Prob. 18BEACh. 14 - Prob. 19BEACh. 14 - Prob. 20BEACh. 14 - Swasey Company earned net income of 1,800,000 in...Ch. 14 - Prob. 22BEACh. 14 - Prob. 23BEACh. 14 - During 20X2, Norton Company had the following...Ch. 14 - Prob. 25BEBCh. 14 - Prob. 26BEBCh. 14 - Roberts Company provided the following partial...Ch. 14 - Prob. 28BEBCh. 14 - Prob. 29BEBCh. 14 - Prob. 30BEBCh. 14 - Prob. 31BEBCh. 14 - During 20X2, Evans Company had the following...Ch. 14 - Stillwater Designs is a private company and...Ch. 14 - Prob. 34ECh. 14 - Jarem Company showed 189,000 in prepaid rent on...Ch. 14 - During the year, Hepworth Company earned a net...Ch. 14 - During 20X1, Craig Company had the following...Ch. 14 - Tidwell Company experienced the following during...Ch. 14 - Prob. 39ECh. 14 - Oliver Company provided the following information...Ch. 14 - Prob. 41ECh. 14 - Prob. 42ECh. 14 - Prob. 43ECh. 14 - Solpoder Corporation has the following comparative...Ch. 14 - Solpoder Corporation has the following comparative...Ch. 14 - The following financial statements were provided...Ch. 14 - Prob. 47PCh. 14 - Prob. 48PCh. 14 - Booth Manufacturing has provided the following...Ch. 14 - The following balance sheets and income statement...Ch. 14 - The following balance sheets and income statement...Ch. 14 - Balance sheets for Brierwold Corporation follow:...Ch. 14 - Balance sheets for Brierwold Corporation follow:...Ch. 14 - Prob. 54PCh. 14 - Prob. 55PCh. 14 - The following balance sheets were taken from the...Ch. 14 - The following balance sheets were taken from the...Ch. 14 - The comparative balance sheets and income...
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