A first-year co-op student is trying to determine the amount of cash and cash equivalents that should be reported on a company's statement of financial position. The following information was provided to the student at year end:
1. Cash on hand in the cash registers totals $2,920.
2. The balance in the commercial bank savings account is $57,800 and in the commercial bank chequing account, $25,000. The company also has a U.S. bank account, which contains the equivalent of $27,000 Canadian at year end.
3. A special bank account holds $200,000 in cash that is restricted for equipment replacement.
4. Amounts due from employees (travel advances) total $8,700.
5. Held-for-trading investments held by the company include $25,000 in a term deposit maturing in 120 days, a Government of Canada bond for $50,000 that falls due in 30 days, and $36,000 in shares of Loblaw Companies Limited.
6. The company has $1,230 of NSF cheques from customers that were returned by the bank. NSF fees charged by the bank for processing these cheques totalled $55.
7. The company keeps $12,000 as a compensating balance with respect to a long-term loan in a special account.
Instructions
(a) Determine which items listed above would be considered to be cash and which would be considered to be cash equivalents.
(b) What combined amount would the company report as cash and cash equivalents on the year-end statement of financial position?
(c) Identify where any items that were not reported as cash and cash equivalents in part (a) should be reported.