BUS 320 Lecture Notes - Lecture 5: Cash Cash, Current Asset, Market Liquidity

• School: Simon Fraser University
• Department: Business Administration
• Course: BUS 320
• Professor: Maureen Fizzel

Document Summary

Cash: most liquid asset o o o. Consist of coins, currency, and other available funds that are on deposit at a bank. Cash equivalents (short-term investments: money-market funds, certificates of deposit o o. Have restrictions or penalties if converting into cash prior to maturity. A contractual right to receive cash or other financial assets from other party. A contract right to exchange financial instruments with another party under conditions that are potentially favorable to the entity. Concern the reporting of o o o. When an amount is material, it is segregated from cash. Report in the current assets section or long-term assets section, depends on the date of availability or expected disbursement. Banks get an interest rate on its loan higher than the stated rate for using the restricted amount that remain on deposit. Must be translated into canadian dollars at the exchange rate on the date of the statement of financial position. Without restriction, include cash as current assets.