Ask Question
16 January, 18:22

At December 31, Year 1, Kale Co. had the following balances in the accounts it maintains at First State Bank: Checking account #101 $175,000 Checking account #201 (10,000) Money market account 25,000 90-day certificate of deposit, due 2/28/Y2 50,000 180-day certificate of deposit, due 3/15/Y2 80,000 Kale classifies investments with original maturities of three months or less as cash equivalents. In its December 31, Year 1, balance sheet, what amount should Kale report as cash and cash equivalents? a) $200,000 b) $190,000 c) $240,000 d) $320,000

+4
Answers (1)
  1. 16 January, 20:47
    0
    c) $240,000

    Explanation:

    The computation of the cash and cash equivalents are shown below:

    = Checking account #101 - Checking account #201 + Money market account + 90-day certificate of deposit

    = $175,000 - $10,000 + $25,000 + $50,000

    = $240,000

    Since the 180 days certificate of deposit has not come under the computation part as the maturity period of this period is more than the actual maturity given in the question i. e three months
Know the Answer?
Not Sure About the Answer?
Get an answer to your question ✅ “At December 31, Year 1, Kale Co. had the following balances in the accounts it maintains at First State Bank: Checking account #101 ...” in 📙 Business if there is no answer or all answers are wrong, use a search bar and try to find the answer among similar questions.
Search for Other Answers