Question

Presented below are independent situations. For each individual situation, determine the amount that should be reported as cash. 1. Checking account balance $851,000; certificate of deposit $1,288,000; cash advance to subsidiary of $901,600; utility deposit paid to gas company $168. Cash balance $ 2. Checking account balance $552,000; an overdraft in special checking account at same bank as normal checking account of $15,640; cash held in a bond sinking fund $184,000; petty cash fund $276; coins and currency on hand $1,242 Cash balance 3. Checking account balance $542,800; postdated check from customer $10,120; cash restricted due to maintaining compensating balance requirement of $92,000; certified check from customer $9,016; postage stamps on hand $568. Cash balance 4. Checking account balance at bank $34,040; money market balance at mutual fund (has checking privileges) $44,160; NSF check received from customer $736. Cash balance 5. Checking account balance $644,000; cash restricted for future plant expansion $460,000; short-term Treasury bills $165,600 (which mature in 6 months); cash advance received from customer $828 (not included in checking account balance); cash advance of $6,440 to company executive, payable on demand; refundable deposit of $23,920 paid to federal government to guarantee performance on construction contract. Cash balance

Answer 1

1)
Checking account balance	$851,000
Add: Certificate of deposits	$1,288,000
Less: Cash advances to subsidiary	($901,600)
Less: Utility deposit paid to gas company	($168)
Cash Balance	$1,237,232
2)
Checking account balance	$552,000
Less: Cash held in a bond sinking fund	($184,000)
Less: Petty cash fund	($276)
Add: Coins and currency	$1,242
Cash Balance	$368,966
3)
Checking account balance	$552,000
Less: Cash required due to maintaining compensating balance requirement	($92,000)
Add: Certified check from customer	$9,016
Cash Balance	$469,016
4)
Checking account balance	$34,040
Less: NSF Check received from customer	($736)
Cash Balance	$33,304
5)
Checking account balance	$644,000
Less: Cash restricted for future plant expansion	($460,000)
Add: Cash advance received from customer	$828
Less: Cash advances to company executive	($6,440)
Less: Payment of refundable deposit	$23,920
Cash Balance	$202,308