Reference no: EM132835466

Problem 1: What amount of "cash and cash equivalents" should be reported at year-end? (Answer and show solution)

AVL Company had the following items on December 31, 2020:

Cash in bank (Checking account)                                                         P2,000,000

Cash in bank (Savings account)                                                          2,500,000

Petty cash fund (P20,000 in currency and expense receipts for P10,000      30,000

Tax fund                                                                                        100,000

Investment in ordinary shares                                                              500,000

Cash in sinking fund (liability is due next year)                                        1,000,000

Time deposit (6months)                                                                   1,100,000

Commercial paper with maturity of 2months                                      300,000

Savings deposit set aside for dividend payable on December 31, 2021            200,000