What are cash equivalents?

A. Cash equivalents are short-term, highly liquid investments with original maturities of three months or less. Treasury bills, commercial paper, certificates of deposit, and money market funds are examples of cash equivalents. These investments are cash substitutes that companies can easily convert back into cash if needed in the operating cycle.

B. Cash equivalents are short-term, highly liquid investments with original maturities of six months or less. Treasury bills, commercial paper, certificates of deposit, and money market funds are examples of cash equivalents. These investments are cash substitutes that companies can easily convert back into cash if needed in the operating cycle.

C. Cash equivalents are short-term, highly liquid investments with original maturities of one year or less. Treasury bills, commercial paper, certificates of deposit, and money market funds are examples of cash equivalents. These investments are cash substitutes that companies can easily convert back into cash if needed in the operating cycle.

D.

Cash equivalents are short-term, highly liquid assets. Money market funds, receivables and inventory are examples of cash equivalents. These investments are cash substitutes that companies can easily convert back into cash if needed in the operating cycle.