Concept explainers
Reporting Cash, Cash Equivalents, and Restricted Cash
Expedia, Inc., reported total cash of $1,862 million at September 30, 2016. Of this amount, $18 million was set aside and could be used only to fulfill the requirement of an aviation authority of a certain foreign country to protect against the potential nondelivery of travel services in that country in the short term. Another $542 million was invested in
TIP: Some items are not current assets.
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Chapter 5 Solutions
Fundamentals Of Financial Accounting
- Dapitan Company had the following account balances at December 31, 2023: Cash in bank Cash on hand Cash legally restricted for addition to plant and expected to be disbursed in 2024 P2,500,000 10,000 1,500,000 Cash in bank includes P200,000 compensating balances against short-term borrowing arrangements. The compensating balances are not legally restricted as to withdrawal by Dapitan Company. In the current assets section of Dapitan Co.'s December 31, 2023 statement of financial position, how should be reported as cash?arrow_forwardWhat is the correct amount of cash? * The statement of financial position of Money Company on December 31, 2020 shows cash of P330,820. The following items were found to comprise this total amount: Checking account in Metrobank Savings account at Far East Bank Petty cash fund (including expense receipts of P250) Cash on hand (undeposited sales receipts) Sinking fund cash Cash in foreign bank (in equivalent pesos) Customers' checks on hand – traveler's check 105,200 30,800 1,500 4,200 35,000 65,000 14,000 23,120 Customers' checks on hand - manager's check Short-term treasury bills Money Company also has on hand a check payable to supplier amounting to P62,000, which has been recorded in the cash disbursements journal in December. The sinking fund is intended to be used to settle the firm's noncurrent bonds payable. 52,000 What is the correct amount of cash?arrow_forwardJayce Co. reported Cash and Cash Equivalents worth $5,800,000 on December 31, 2020. When the entity's financial statements were being prepared, the following information were taken into consideration with regard to its cash and cash equivalents: a. A check from a customer amounting to $65,000 was dated December 28, 2020. It was included in the entity's account, but it was not signed by the payee. b. A check written to a supplier having a face value of $140,000 dated May 15, 2020 was not presented to the bank by the end of the year. c. An electronic fund transfer of $300,000 was not reflected in the entity's books as of December 31, 2020. d. Cash receipts amounting to $200,000 which were dated January 2021 were included in Kisses' December 2020 books. e. Cash disbursements made at the last week of December totaling $350,000 were recorded in the January 2021 books. f. Chicago Trust Bank account of $5,800,000 is a foreign-currency denominated account, translated to Dollars using the…arrow_forward
- The following information pertains to Mapa Company on December 31, 2023: Correct cash balance in general checking account with BDO bank Overdraft in special checking account with Export bank Cash accumulated in special fund that will be used for plant expansion Cash surrender value Cash travel advances in the hands of company salespersons Currency and coins in petty cash fund (including unreplenished vouchers of P2,500) P800,000 (25,000) 3,200,000 75,000 30,000 20,000 What is the total amount that Mapa Company should report as "cash" in the current assets section of the statement of financial position on December 31, 2023?arrow_forwardIndie Company had the following account balances at December 31, 2021: Cash in Metrobank (includes P300,000 of compensating balance against short term borrowing arrangements. The compensating balance is not legally restricted as to withdrawal by Indie Company) - P1,875,000 Cash in BPI - P180,000Cash on hand (includes a customers check for P15,000 dated January 5, 2022) - P125,000 Cash restricted for acquisition of machinery (expected to be disbursed in 2022) - P1,600,000 How much is the total cash reported in the current asset section of Indie Company's December 31, 2021 statement of financial position?arrow_forwardE7.1 (LO1) (Determine Cash Balance) The controller for Wallaby plc is attempting to determine the amount of cash and cash equivalents to be reported on its December 31, 2019, statement of financial position. The following information is provided. 1. Commercial savings account of £600,000 and a commercial checking account balance of £800,000 are held at First National Bank of Olathe. 2. Money market fund account held at Volonte Co. (a mutual fund organization) permits Wallaby to write checks on this balance, £5,000,000. 3. Travel advances of £180,000 for executive travel for the first quarter of next year (employee to reimburse through salary reduction). 4. A separate cash fund in the amount of £1,500,000 is restricted for the retirement of long-term debt. 5. Petty cash fund of £1,000. 6. An 1.O.U. from Marianne Koch, a company customer, in the amount of £150,000. 7. A bank overdraft of £110,000 has occurred at one of the banks the company uses to deposit its cash receipts. At the…arrow_forward
- 1. Violet Company had the following cash balances at December 31, 2017: Cash in banks Petty cash funds (all funds were refmbursed on December 31, 2017) Cash restricted for additions to plant (expected to be disbursed In 2018) P375,000 5,000 500,000 Cash in banks includes P125, 000 of compensating balances against short-term borrowing arrangements at December 31, 2017. The compensating balances are legally restricted to withdrawal by Violet. In the current asset section of Vlolet's December 31, 2017, balance sheet, what total amount should be reported as Cash?arrow_forwardThe controller for Pharoah Company is trying to determine the amount of cash to report on the December 31, 2020 statement of financial position. The following information is provided: 1. A commercial savings account with $660,000 and a commercial chequing account balance of $880,000 are held at First National Bank. There is also a bank overdraft of $37,000 in a chequing account at the Royal Scotia Bank. No other accounts are held at the Royal Scotia Bank. 2. Pharoah has agreed to maintain a cash balance of $93,000 at all times in its chequing account at First National Bank to ensure that credit is available in the future. 3. Pharoah has a $6-million investment in a Commercial Bank of Montreal money-market mutual fund. This fund has chequing account privileges. 4. There are travel advances of $25,000 for executive travel for the first quarter of next year. (Employees will complete expense reports after they travel.) 5. A separate cash fund in the amount of $1.0…arrow_forwardLouis Company had the following account balances at December 31, 2021: Cash in Metrobank 1,875,000 Cash in BPI 200,000 Cash on hand (includes a customer's check for P15,000 dated January 5, 2022 125,000 Cash restricted for acquisition of machinery (expected to be disbursed in 2022) 1,600,000 Cash in Metrobank include P300,000 of compensating balance against short-term borrowing arrangements. The compensating balance is not legally restricted as to withdrawal by Louis. Question: In the current asset section of Louis' December 31, 2021 statement of financial position, total cash should be reported at a. P2,185,000b. P1,885,000c. P3,785,000d. P3,485,000arrow_forward
- The Valorant Company has the following items in its general ledger: Petty cash fund- $5,000; Checking account, Bank of Korea- $290,000; Cash fund legally restricted for short-term borrowings, Bank of Korea- $100,000; Checking account, BPI Bank- $(170,000); Checking account, Metrobank- $49,500. The amount of cash that should be reported in Valorant's balance sheet as a current asset is:arrow_forwardDelta Automotive Corporation has the following assets listed in its 12/31/2024 trial balance: Cash in bank-checking account U.S. Treasury bills (mature in 60 days)* Cash on hand (currency and coins) U.S. Treasury bills (mature in six months)* Undeposited customer checks *Purchased on 11/30/2024 Required: $ 22,500 5,000 1,350 10,000 1,840 1. Determine the correct balance of cash and cash equivalents to be reported in the current asset section of the 2024 balance sheet. 2. For each of the items not included in your answer to requirement 1, select the correct classification of the item. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Determine the correct balance of cash and cash equivalents to be reported in the current asset section of the 2024 balance sheet. Cash and cash equivalents includes: Total Required 1 Required 2 $ 0 For each of the items not included in your answer to requirement 1, select the correct classification of the item.arrow_forwardА. Savonn Enterprise is a small retail business located in Alor Setar, Kedah. The followings are information on bank transactions of Savonn Enterprise as at 31 January 2022: i. Amount of cash as shown on the bank statement and book respectively are RM33,815 and RM33,044. The bank collected RM550 on a note receivable for Savonn Enterprise. The bank charged a collection fee of RM10 which was credited to Savonn Enterprise's account. A deposit of RM2,850, representing cash receipts by Savonn Enterprise on 31 January, did not appear on the bank statement. An Non-Sufficient Fund (NSF) cheque for RM180 from a customer, Mr Gebang Kencang, was returned with the bank statement. Also returned with the bank statement is a cheque amounted RM650 from Mr Kuwat Klentong for having different authorised signature on the cheque. The bank paid correctly an amount of RM3,680 for cheque No 2808 which was recorded in a book as RM3,860. Outstanding cheque include cheques No. 1001 and No. 1002, with the amount…arrow_forward
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