📏CPA EXAM PREP

Cash and Cash Equivalents

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Question

What is an imprest petty cash fund?

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Answer

A fixed petty cash amount.

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Question

Why is remaining maturity not the test for cash equivalent classification?

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Answer

Original maturity from purchase date controls.

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Question

Why is a postdated check not cash when received?

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Answer

It is not yet negotiable.

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Question

How is an NSF customer check treated on the books?

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Answer

Remove it from cash and reinstate a receivable.

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