A) Other than coin and currency, items which can be included as cash in balance sheet are

given below

Bank Deposit (instant access)

Negotiable instruments (i.e Money orders),
Checks(i.e certified/personal/cashiers checks)
Balance with banks
Bank draft.

B) Cash equivalents highly liquid short term investments. However, these short term
instrument have to be convertible to specific cash amount instantly and must have short
maturity, so that interest rate changes will have minimum effect on their value. As a general
characteristics, these type of securities have minimal risk and also comparatively lower
return. Cash equivalents may include the following instruments

Bank deposits (with unlimited withdrawal)

Marketable securities (highly liquid generally 3-12 months maturity)
Money Market funds
T-bills
High rated corporate commercial paper etc.

C) It is mandatory for a corporate borrower to maintain a certain percentage of the total debt
as balance which serve as a security at any point of time. This regulation is known as
compensating balance arrangement. As a rule, there is a minimum amount set by the bank
which the borrower has to maintain. However, there might be an exception to this regulation
where bank will allow the borrower to go beyond certain minimum requirement in expense
of higher interest rate.

The compensating balance arrangements are reported in the balance sheet as restricted cash
in Cash and cash equivalent items of current assets (if its short term borrowing). In
addition, for long term borrowings its recorded in the non-current asset as Cash on deposit
(compensating balance). If the use of cash amounts are not restricted, companies tend to
mention the balance arrangement in the notes.

D) Generally, cash equivalents include short term investments with less than 3 months
maturity. On the other hand, investments which have a maturity between 3 and 12 months
are called short term (temporary) investments and are not included in cash equivalents.
Temporary Investments head is used to add short-term (temporary) investments in the
balance sheet.

E) The company has made a loss on sale of receivables.

Loss on sale of receivable= Carrying value of receivables -net proceeds,

=(360-345)=$15 million.

In addition, there might be a probable payment of $15 million and it is recorded in the
liability part of the balance sheet of Occidental. As a result of the sale, for now, the income
will decrease by $15 Million.

F) The transaction mentioned in (e) will have the following impacts in Occidentals liquidity

the net cash position of the company will improve as a result of transaction (cash will
increase)
The receivable amount will decrease, hence, it will improve the current ratio (as
receivable part of current ratio will decrease).