Exercise 7-12 A new accountant at Leftwich Inc. is trying to identify which of t

Question

Exercise 7-12 A new accountant at Leftwich Inc. is trying to identify which of the amounts shown below should be reported as the current asset “Cash and cash equivalents” in the year-end balance sheet, as of April 30, 2014. 1. $99 of currency and coin in a locked box used for incidental cash transactions. 2. A $10,340 U.S. Treasury bill, due May 31, 2014. 3. $277 of April-dated checks that Leftwich has received from customers but not yet deposited. 4. An $80 check received from a customer in payment of its April account, but postdated to May 1. 5. $5,290 in the company’s checking account. 6. $6,850 in its savings account. 7. $72 of prepaid postage in its postage meter. 8. A $47 IOU from the company receptionist.

Explanation / Answer

Cash and cash equivalents $99 of currency and coin in a locked box used for incidental cash transactions 99 A $10,340 U.S. Treasury bill, due May 31 10340 $277 of April-dated checks that Leftwich has received from customers but not yet deposited 277 5,290 in the company’s checking account 5290 $6,850 in its savings account 6850 Cash and cash equivalents 22856

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