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1 February, 06:01

Cash equivalents are securities that a. have maturity dates of 3 months or less. b. have maturity dates of at least 6 months. c. management intends to convert into cash within 1 year. d. management intends to convert into cash within the normal operating cycle.

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  1. 1 February, 06:19
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    a. have maturity dates of 3 months or less

    Explanation:

    Cash equivalents refer to those short term highly liquid security investments such as marketable securities like commercial papers which can be converted into cash within 90 days or 3 months.

    Cash equivalents are characterized by their maturity period being 3 months or lesser.

    Commercial papers and certificate of deposits maturing in less than 3 months constitute cash equivalents.

    Two major characteristics of cash equivalents being, their maturity period being 3 months or lesser and their maturity value is not subject to fluctuations i. e it is known in advance.
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Home » Business » Cash equivalents are securities that a. have maturity dates of 3 months or less. b. have maturity dates of at least 6 months. c. management intends to convert into cash within 1 year. d.
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