(Determining Cash Balance) The controller for Clint Eastwood Co. is attempting to determine the amount of cash to be reported on its December 31, 2014, balance sheet. The following information is provided.
1. Commercial savings account has a balance of: $600,000 and a commercial checking account has a balance of$900,000 Both are held at First National Bank of Yojimbo.
2. Money market fund account held at Volonte Co. (a mutual fund organization) permits Eastwood to write checks on this balance, $5,000,000
3. Travel advances for executive travel for the first quarter of the next year (employee to reimburse through salary reduction) are: $180,000
4. A separate cash fund is restricted for the retirement of long-term debt. Its balance is $1,500,000
5. Petty cash fund of: $1,000
6. An I.O.U. from Marianne Koch, a company customer, in the amount of $190,000
7. A bank overdraft of $110,000 has occurred at one of the banks the company uses to deposit its cash receipts. At the present time, the company has no deposits at this bank.
8. The company has two certificates of deposit, each totalling $500,000 These CDs have a maturity of 120 days.
9. Eastwood has received a check that is dated January 12, 2015, in the amount of $125,000
10. Eastwood has agreed to maintain a cash balance of $500,000 at all times at First National Bank of Yojimbo to ensure future credit availability.
11. Eastwood has purchased $2,100,000 of commercial paper of Sergio Leone Co. which is due in 60 days.
12. Currency and coin on hand amounted to $7,700
Instructions
(a) Compute the amount of cash to be reported on Eastwood Co.'s balance sheet at December 31, 2014.
(b) Indicate the proper reporting for items that are not reported as cash on the December 31, 2014, balance sheet.