ACC- Occidental Petroleum Corporation



Occidental Petroleum Corporation reported the following information in a recent annualreport.

(a) What items other than coin and currency may be included in “cash”?
(b) What items may be included in “cash equivalents”?
(c) What are compensating balance arrangements, and how should they be reported infinancial statements?
(d) What are the possible differences between cash equivalents and short-term(temporary) investments?
(e) Assuming that the sale agreement meets the criteria for sale accounting, cashproceeds were $345 million, the carrying value of the receivables sold was $360 million,and the fair value of the recourse liability was $15 million, what was the effect on incomefrom the sale of receivables?
(f) Briefly discuss the impact of the transaction in (e) on Occidental’s liquidity.


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