Cash

Meaning:

Cash refers to money in the form of currency (coins and notes) and funds that are  readily available for immediate use in business or personal transactions.

Example:

 if a business has ₹50,000 in cash and ₹1,00,000 in the bank, the total  of ₹1,50,000 is recorded under Current Assets as Cash and Bank Balance on the balance  sheet.

How to understand Cash:

• Cash is the most liquid form of asset, meaning it can be used instantly to buy goods, pay bills,
or settle debts.
In accounting, "cash" encompasses cash equivalents, such as treasury bills and short-term deposits, which can be quickly converted into cash.

Importance of Cash:

• It is essential for maintaining liquidity, ensuring that businesses can meet their short-term obligations.
Cash facilitates growth and expansion through reinvestment and reduces dependency on  external borrowing.


Type of Cash


Physical Cash: Coins and currency notes. 
Bank Cash: Money in current or savings accounts.  Cash Equivalents: Treasury bills, short-term deposits, and money market funds.


Physical Cash: Coins and currency notes.
Bank Cash: Money in current or savings accounts.
Cash Equivalents: Treasury bills, short-term deposits, and money market funds.