Part II. Problem Solving. AAA Company had the following account balances on December 31,2020. Petty cash fund 50,000 Cash in bank - current account 4,000,000 Cash in bank - sinking fund Cash on hand 2,000,000 500,000 Cash in bank - restricted account for plant addition expected to be disbursed in 2021 1,500,000 Treasury bills 1,000,000 The petty cash fund includes unreplenished December 2020 petty cash expense vouchers of P10,000 and employee IOU of P5,000. The cash on hand includes a P100,000 check payable to AAA Company dated January 15,2021. In exchange for a guaranteed line of credit, AAA Company has agreed to maintain a minimum balance of P200,000 in its unrestricted current bank account. The sinking fund is set aside to settle a bond payable that is due on June 30,2023. 1. What should be reported as "cash and cash equivalents" on December 31,2020?

Part II. Problem Solving. AAA Company had the following account balances on December 31,2020. Petty cash fund 50,000 Cash in bank - current account 4,000,000 Cash in bank - sinking fund Cash on hand 2,000,000 500,000 Cash in bank - restricted account for plant addition expected to be disbursed in 2021 1,500,000 Treasury bills 1,000,000 The petty cash fund includes unreplenished December 2020 petty cash expense vouchers of P10,000 and employee IOU of P5,000. The cash on hand includes a P100,000 check payable to AAA Company dated January 15,2021. In exchange for a guaranteed line of credit, AAA Company has agreed to maintain a minimum balance of P200,000 in its unrestricted current bank account. The sinking fund is set aside to settle a bond payable that is due on June 30,2023. 1. What should be reported as "cash and cash equivalents" on December 31,2020?

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Concept explainers

Bank Reconciliation Statement

As a commerce student, we all know that every business has to maintain a cash book to maintain all his cash and bank transactions. A cash book is a book which has two columns, one cash column and one bank column.

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Part II. Problem Solving.
AAA Company had the following account balances on December 31,2020.
Petty cash fund
50,000
Cash in bank - current account
4,000,000
Cash in bank - sinking fund
2,000,000
Cash on hand
500,000
Cash in bank - restricted account for plant addition
expected to be disbursed in 2021
1,500,000
Treasury bills
1,000,000
The petty cash fund includes unreplenished December 2020 petty cash
expense vouchers of P10,000 and employee IOU of P5,000. The cash on
hand includes a P100,000 check payable to AAA Company dated January
15,2021. In exchange for a guaranteed line of credit, AAA Company has
agreed to maintain a minimum balance of P200,000 in its unrestricted
current bank account. The sinking fund is set aside to settle a bond
payable that is due on June 30,2023.
1. What should be reported as
"cash and cash equivalents" on December
31,2020?

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