Target Exam

CUET

Subject

-- Accountancy Part B

Chapter

Cash Flow Statement

Question:

Where will a bank deposit with 80 days of maturity included in cash flow statement of the company?

Options:

Operating activity

Investing activity

Financing activity

Cash and cash equivalents

Correct Answer:

Cash and cash equivalents

Explanation:

The correct answer is option 4- Cash and cash equivalents.

A bank deposit with 80 days of maturity included in Cash and cash equivalents in the cash flow statement of the company.

An investment normally qualifies as cash equivalents only when it has a short maturity, of say, three months or less from the date of acquisition.