Question

“Cash float” would be which type of account?

Select one:

a. Fixed asset

b. Proprietary

c. Expense

d. Current asset

e. Current liability

Clear my choice

Answer 1

Answer :

Cash float may be defined as the difference between the cash balance recorded in your accounting system's cash account and the amount of cash reflecting in your company's bank account. This may arise when recipient of the Check has not yet cashed the check or the deposited Check has not yet credited by bank in your account.

In above situations the cash balance of accounting system's cash account has been overstated. Because the Cash balance is recorded under current assets, the cash float will also be a current asset account.

So, Correct Option is (d) Current Asset.