ADMS 2500 Chapter Notes - Chapter 6: Petty Cash, List Of The Shield Episodes, Bank Reconciliation

• School: York University
• Department: Administrative Studies
• Course: ADMS 2500
• Professor: Romi Lee Sevel

Document Summary

A balance sheet prepared for outside users normally groups the following cash balances together and shows the total amount under a single heading, cash: Cash in bank accounts: businesses frequently have more than one bank account to help manage receipts and disbursements, minimize service charges and maximize interest on any deposit balances. Cash on hand: receipts from customers which have not yet been deposited in the bank. Petty cash: businesses also keep petty cash, small amounts of currency used for small disbursements. It is advantageous to have some cash readily available because it takes time and costs over fifteen dollars to issue a cheque, if clerical preparation time, supply cost, mailing, bank charges and executive review time are considered. Other instruments that meet the definition of cash according to gaap: short term, highly liquid investments that are readily convertible to known amounts of cash with insignificant risk if change in value.