Studied by 0 people
Cash
This includes money and any other negotiable instrument that is payable in money and acceptable by the bank for deposit and immediate credit.
Postdated Checks
Checks that cannot be considered as cash yet because these checks are unacceptable by the back for deposit and immediate credit.
Unrestricted Cash
Cash that is readily available in the payment of current obligations and not be subjected to any restrictions, contractual or otherwise.
Cash on hand
Includes undeposited cash collections and other cash items awaiting deposit.
Cash in bank
Includes demand deposits or checking account and saving deposit which are unrestricted as to withdrawal.
Cash fund for current purposes
Cash items that include petty cash fund, payroll fund, and dividend fund
Cash Equivalents
Short-term and high-liquid investments that are readily convertible into cash; acquired three months before maturity. – PAS 7
Equity Investments
Do not have maturity date making it unqualified as cash equivalents.
Preference Shares
Equity investments with specified redemption date and acquired three months before that date can be qualified as Cash Equivalents.
Cash Equivalents
Excess cash investment that has a term of three months or less
Short-term Investments
Excess cash investment that has a term of more than three months but within one year and are presented as current assets.
Long-term Investments
Excess cash investment that has a term of more than one year - noncurrent
Face Value
Measurement of Cash
Estimated Realizable Value
Measurement of Cash of recoverable amount is less than the face value.
Current Exchange Rate
Used when foreign currency is translated to Ph peso
Notes to Financial Statement
Details comprising the cash and cash equivalents should be disclosed here.
Cash fund for current purposes
Cash fund included in cash and cash equivalents
Cash fund for noncurrent purpose
Cash fund for payment of noncurrent obligation and shown as long-term investment
Classification of the related liability
The classification of cash fund as current and noncurrent should parallel this.
Bank overdraft
Cash in bank account that has a credit balance; and should no be offset against other bank accounts with debit balances. – not permitted in the Philippines.
Compensating Balance
Minimum checking or demand deposit account balance that must be maintained in connection with a borrowing arrangement with a bank.
Undelivered or unreleased check
Checks that are merely drawn and recorded but not given to the payee before the end of the reporting period.
Adjusting Entry
Required to restore the cash balance and set up the liability of the payor due to undelivered check.
Postdate Check
A check drawn, recorded, and already given to the payee but bears a date subsequent to the end of reporting period.
Stale Check
Check long outstanding: a check not encashed by a payee within a relatively long period of time.
The Negotiable Instruments Law
Provides that where the instrument is payable in demand, presentment must be made to usage within a reasonable time after issue. – does not specify a definite period.
Stop Payment order
May be issued to the bank for cancelation of a previously issued check after 3 months of no encashment.
Miscellaneous income
Accounting for stale check that has an immaterial amount.
Cash Shortage
Recorded when the cash count shows cash which is less than the balance per book.
Cash Overage
Recorded when the cash count shows cash which is more than the balance per book
Cash short or over account
Offsetting account for cash shortage and cash overage
Imprest System
All cash receipts should be intact, and all cash disbursement should be made by means of check
Petty Cash Fund
Money set aside to pay small expenses which cannot be paid conveniently by means of check
Fluctuating fund system
Accounting for petty cash because the checks drawn to replenish the fund do not necessarily equal the petty cash disbursement.
Imprest fund system
The one usually followed in handling petty cash transactions.
Note 
Flashcard (85)