endstream endobj startxref Examples of Cash Equivalents. All Rights Reserved. Types of Cash and Cash Equivalents. Intermediate Accounting 1 by Robles and Empleo Financial Accounting 1 by Valix and Peralta NO COPYRIGHT INFRINGEMENT … Companies will often have a cash box with some money that employees can use to pay minor bills or lunch for executives, among other uses. The entire disclosure for cash and cash equivalent footnotes, which may include the types of deposits and money market instruments, applicable carrying amounts, restricted amounts and compensating balance arrangements. Petty cash floats must also be stored in a safe or cabinet overnight. Learn faster with spaced repetition. Petty cash is basically a small amount of cash that can be used by employees to buy miscellaneous goods such as girl scout cookies or that cleaner people always come to your office to try and sell. AUDIT OF CASH AND CASH EQUIVALENTS PROBLEM NO. https://www.answers.com/Q/Is_Petty_cash_is_cash_and_cash_equivalents The small amount of cash that a … 5. Is Petty cash is cash and cash equivalents. The following information is available for the month of April. 7) Examples of cash equivalents include time deposits, certificates of deposit, and marketable securities. 1) Which of the following is not a "cash equivalent"? Review the following items, and decide if each would be more appropriately classified as cash, cash equivalent, or neither a) Currency in the petty cash box b) Postage stamps in a file cabinet The employee recording the cash receipts should not have any further involvement in handling, depositing, or reconciling cash. Petty cash fund is money set aside to defray relatively small amount of cash disbursements. Companies will often have a cash box with some money that employees can use to pay minor bills or lunch for executives, among other uses. Cash and Cash Equivalent; Petty Cash; Petty cash is the amount which is kept in to meet daily expenses requirement of the business. --Sophocles (496-406 BC) 2. - in 12 months or less. 2) An imprest petty cash fund would least likely be used to pay for which of the following items? A check drawn payable to petty cash is encashed, and the petty cashier places the money in the petty cash fund (which is often kept in a locked box or petty cash drawer). University PolicyThe purpose of a petty cash fund is to provide cash to business units sufficient to cover minor expenditures. Petty cash fund 10,000 Cash and cash equivalents P2,910,000 Answer: C PROBLEM NO. In accounting terms, cash is the currency and coinage owned by a company. Petty cash count and cash certificate for the year end balance of cash in hand. A minimum balance that must be maintained by the firm in relation to a borrowing. Petty cash floats must also be stored in a safe or cabinet overnight. Petty cash book is a part of accounting cycle It is prepaid for the normal daiy expenditres of the organization. It is a non-monetary asset i.e. Cash & cash equivalents 1. 5 You were able to gather the following from the December 31, 2006 trial balance of Mandaluyong Corporation in connection with your audit of the company: Cash on hand P 500,000 Petty cash fund 10,000 BPI current account 1,000,000 [i{`]���-��n�aj�$��h�"׳�~�U?G�F{~��8��. It is a non-monetary asset i.e. Cash equivalents: C. Are readily converted to a known cash amount. Petty cash is an amount given to a business unit to cover minor miscellaneous items for which it is not practical or possible to make payments by bank transfer or check. Petty cash is similar to these topics: Certified check, Cheque clearing, Blank cheque and more. 2142 0 obj <>/Encrypt 2114 0 R/Filter/FlateDecode/ID[<59EECE3EEA3C2947A231C17ECF4C1982><0C1167176244E747A9A25126206BA49C>]/Index[2113 76]/Info 2112 0 R/Length 133/Prev 467536/Root 2115 0 R/Size 2189/Type/XRef/W[1 3 1]>>stream Petty cash is a small amount of discretionary funds in the form of cash used for expenditures where it is not sensible to make any disbursement by cheque, because of the inconvenience and costs of writing, signing, and then cashing the cheque. 14. endstream endobj 2114 0 obj <>>>/Filter/Standard/Length 128/O(��j�'�0mMD���]��Ik6�\)'t[^`h)/P -1340/R 4/StmF/StdCF/StrF/StdCF/U(��F��\)�Հ�;��� )/V 4>> endobj 2115 0 obj <>/Metadata 61 0 R/Pages 2111 0 R/StructTreeRoot 95 0 R/Type/Catalog>> endobj 2116 0 obj <>/MediaBox[0 0 612.12 936.12]/Parent 2111 0 R/Resources<>/Font<>/ProcSet[/PDF/Text/ImageC]/XObject<>>>/Rotate 0/StructParents 0/Tabs/S/Type/Page>> endobj 2117 0 obj <>stream 5 You were able to gather the following from the December 31, 2006 trial balance of Mandaluyong Corporation in connection with your audit of the company: Cash on hand P 500,000 Petty cash fund 10,000 BPI current account 1,000,000 A petty cash fund is established by transferring a specified amount of cash from the general checking accountto a person who is given custodial responsibility for the fund. Cash is the most liquid asset, including physical money such as bills and coins, checks, bank accounts, and petty cash. FinAcc1 Cash and Cash Equivalents / Petty Cash Fund G. Ong Cash & Cash Equivalent - 1 of 5 CASH – defined as the most liquid asset of an enterprise; thus, it is usually the first item presented in the current assets section of the balance sheet. Highly liquid investments 35,117. - The sum of all cash and cash equivalents divided by the total current liabilities. Money market funds. 6) Companies may purchase marketable securities as a way to temporarily invest excess cash. Generally, the petty cashier is given the reimbursement at the beginning of next month. Record cash receipts using pre-numbered receipts, cash registers, or pre-numbered event tickets. The maker, the payee, and the bank. At times, every business finds it convenient to have small amounts of cash available for immediate payment of items such as delivery charges, postage stamps, taxi fares, supper money for employees working overtime, and other small items. Petty cash fund 10,000 Cash and cash equivalents P2,910,000 Answer: C PROBLEM NO. Cash in bank account $6455. However, the petty cash amount might be combined with the balances in the other cash accounts and their total reported as Cash or as Cash and cash equivalents as the first current asset. d. Cash … Cash and Cash Equivalent; Petty Cash; Petty cash is the amount which is kept in to meet daily expenses requirement of the business. What is a sample Christmas party welcome address? A summary of the petty cash expenditures made by the petty cash custodian as of April 10 is as h�bbd```b``>"o��� �IDJL�� ��@��g�H��`�� &9��%�| &�jLA$X C9�|$�"A�H �_@��l2c���~ �� H��������ql�(������ z�� money orders $257. Are short-term, highly liquid investment assets. The use of petty cash funds should be limited to reimbursement of staff members and visitors for small expenses, generally not to exceed $50, such as taxi fares, postage, office supplies, etc. 2188 0 obj <>stream money market fund balance $12,400. 1) Which of the following is not a "cash equivalent"? The material on this site can not be reproduced, distributed, transmitted, cached or otherwise used, except with prior written permission of Multiply. 2113 0 obj <> endobj What is the correct amount of cash? A cash equivalent can be defined as a liquid investment that can be converted into cash _____. Also, it is very useful in the audit of petty cash this way. This includes the money in company’s bank account, petty cash drawer, and register. A company typically uses petty cash to make small purchases or reimburse employees for minor expenditures. 4. Cash reconciliations must be prepared at least monthly by someone independent of the cash receiving, processing and recording activities. Treasury bills. Cash in savings accounts. Mishandled cash without a record of receipt is extremely difficult to trace and reconcile. Bank drafts. R$+�7�N�n�� Cash larceny means stealing cash that has already been recorded on the employer's books. Customers' check on hand Traveler's Check 14,000. chapter audit of cash cash equivalents audit program for cash audit objectives: to determine that: cash balances at the end of the reporting period represent Short-term government bonds. Petty cash. Cash Over and Short for $3. Besides maintaining a main or general cash book, many companies also maintain a small cash book known as petty cash book to record small day to day expenditures of the business.. What is Petty Cash? Petty cash is easy to steal, so make sure you protect it: Separate duties, so the person who is recording transactions is different from the person putting the transactions into your accounting system. Classified as current or non-current based on related loan classification. The Department Chair or equivalent administrator designates a fund custodian who is responsible for maintaining the petty cash fund. Cash and cash equivalents are part of the current assets section of the balance sheet and contribute to a company’s net working capital. Petty Cash A/C $200. Cash equivalents are investments that can readily be converted into cash. Petty cash transactions provide convenience for small transactions for which issuing a check is unreasonable or unacceptable. =�Y)��#ᣇ��jZ!������b4���#�J%�#���a�yc�"�So7{&iP1���(���ξ�%��V`A$5��qɎ����}'���9�Xq�0(��O�Ҿ�h)͑>�`!����t�ˑ��[g� �}�4��?\v�'P�Mp2�:��krS��%�L7�G��C�[��J^���IN���y�A؇�`^���?�2��q���n�6� z��Z���2s�b�a! Cash for $20. Coin and currency, petty cash, cash in bank, and negotiable instruments such as ordinary checks, cashier's checks, certified checks, and money orders. Cash equivalents: A. A $140 petty cash fund has cash of $20 and receipts of $117. Marketable securities have durations of less than one year, have high trading volumes and sustain very little price fluctuations. Cash in checking accounts. Petty cash is a small amount of discretionary funds in the form of cash used for expenditures where it is not sensible to make any disbursement by cheque, because of the inconvenience and costs of writing, signing, and then cashing the cheque. Cash equivalents are short-term, highly liquid investments with a maturity date that was 3 months or less at the time of purchase. *�M�-�K� 1�$*n�_� Reporting Petty Cash on the Financial Statements The petty cash amount may appear as the first or second item listed in the current asset section of the balance sheet. NSF checks from customers returned by bank $867. petty cash balance $350. Study Cash and Cash Equivalents flashcards from Jennifer Perkins's class online, or in Brainscape's iPhone or Android app. B. The highly liquid investments had maturities of 3 months or less when they were purchased. What are the release dates for The Wonder Pets - 2006 Save the Ladybug? To establish a petty cash account, business units must submit a Petty Cash Action Form signed by the Financial Dean or equivalent (or designee) and a Payment Request in HCOM to fund the petty cash account. Examples of cash equivalents are: Commercial paper. b. 5. This is due to cash may be inappropriately used without proper authorization and wrong account or incorrect timing of record may be made involving in cash transactions. McMann, Inc. decided to establish a petty cash fund to help ensure internal control over its small cash expenditures. Wherever possible, local units should use the PCard instead of petty cash. Each month, accountants or other employees will need to balance petty cash and replenish the funds. A saving deposit for 6 month would not qualify as a cash equivalent particularly if the interest rate environment is volatile. Cash and Cash equivalent 1. ��O����f$�� 2. Like the assets when there is a transfer from cash in hand to petty cash account. Like all financial activities in a firm, proper petty cash accounting is a must. As cash equivalents are considered part of cash, any conversion from cash equivalents to cash at bank or from cash at bank to cash on hand is not reflected in the statement of cash flows as a cash inflow or outflow. Topic. 10. The most common way of accounting for petty cash expenditures is to use the imprest system. Petty cash represents a small cash fund a company uses to make small purchases. When the fund is created and everytime it is replenished. How many candles are on a Hanukkah menorah? �� ��6`,|��R��M�=�aXP��D��A��:A%E�:Z?����^N��_��$�������n���e\5�4X�P�J���Z���t^�.�1׺��P��Sф � Q�$��ڲ8$+ODJ"~Z�[�O��+#���>�n�G �ʷBq��-�6�V���O�-u�ah��-EFg�fEP5���iG3��*C��5���i!�*���z.���G���s� �p:� �ex����Ry=���1�._E�-�9�\�)�#��tz=�3X��N��v�| �1�3|3�4U�*��H�qJ9��Ɗ{�2�9;�$��1�4-{n2. c. Petty Cash for $120. 01 1,280,000 Examples of cash are: Coins. Then, the main cashier provides a cash amount equivalent to the total petty cash payments made at the month to the petty cashier. Only when the fund is created. Petty cash book is a type of cash book that is used to record minor regular expenditures such as office teas, bus fares, fuel, newspapers, cleaning, pins, and causal labor etc. An example of larceny is cash an employee steals from a cash drawer after ringing up a sale. A company typically uses petty cash to make small purchases or reimburse employees for minor expenditures. 2 Define "compensating balance." Cash on hand (undeposited sales receipts) 4,200. What does contingent mean in real estate? Safekeeping of cash-All cash and cash equivalents must be kept in a locked box in a safe or cabinet. Why don't libraries smell like bookstores? Cash Fund -working funds segregated for current purposes such as petty cash fund, change fund, payroll fund, dividend fund, tax fund, and interest fund. – to be reported as cash, it must be unrestricted and immediately available for use in the current operations. For example, in a normal circumstance, the petty cash balance at the end of last period should be the same as the petty cash balance at the … 15. Larceny is more difficult to conceal than skimming because the stolen funds have been recorded in the employer's accounting system. In other words, there is very little risk of collecting the full amount being reported. Petty cash fund (including expense receipts for 250) 1,500. Keep the petty cash box in a secure location, known only to one or two people. Petty cash represents a small cash fund a company uses to make small purchases. Short term treasury bills 52,000. petty cash fund. A receipt issued by a depository institution (such as a bank, credit union, or finance or insurance company) to a depositor for a long-term deposit is known as a(n) ___________. Cash in bank $46,350. Petty cash is an amount given to a business unit to cover minor miscellaneous items for which it is not practical or possible to make payments by bank transfer or check. %%EOF Money orders. ˚B����{��1@�I�r�:�[���?<2M��iL�V���� ��*�`ѩt��j �Ŗ� FINANCIAL ACCOUNTING 1: CASH AND CASH EQUIVALENT INTERMEDIATE ACCOUNTING 1: CASH AND CASH EQUIVALENT ... deposit which are unrestricted as to withdrawal. 6. %PDF-1.6 %���� �XX� The term cash equivalent refers to _____. Explanation In most companies, there are many occasions in which a small amount of cash must be spent on short … We call this amount of cash as reimbursement. Business units should attach the signed Petty Cash Action Form to their Payment Request as supporting documentation. other than cash and cash equivalents It is without physical substance Looking at the definition of Intangible asset we can confirm that Cash is NOT an intangible asset as IASs has explicitly excluded it from its definition. Cash Equivalent . Cash reconciliations must be prepared at least monthly by someone independent of the cash receiving, processing and recording activities. A. petty cash; Definition of Cash Equivalents. ... Called the clearing cycle and normally results in a credit to the account at the bank of deposit, and an equivalent debit to the account at the bank on which it was drawn, with a corresponding adjustment of accounts of the banks themselves The petty cash must not exceed the local currency equivalent of US$600 per business unit. 18. Usually, the amount of petty cash is a relatively low amount and in order to give proper supports of the expenses, a custodian is appointed. It will be debited with the amount received and when purchases are done by petty cash, then the petty cash account will be credited. Cash and Cash Equivalents. 13. To make the cut as a cash equivalent, a marketable security must be liquid or converted into cash. ��47L��Ə,=�U�"ȳ�L#���t�p��P/z��-޾�4�����Yp�C5�i�(:�:�G��u�ֿ~�r�k��v How long will the footprints on the moon last? End of Fiscal Year Replenish petty cash funds at the end of the fiscal year (prior to Presentation of Petty Cash Account in Balance Sheet: Company’s financial statements are mainly of 4 types. Petty cash is a small amount of cash that is used to make incidental cash purchases and reimbursements, such as for delivered meals.Petty cash can mitigate the effects of the more cumbersome accounts payable process, which involves the issuance of a check. Review the following items, and decide if each would be more appropriately classified as cash, cash equivalent, or neither a) Currency in the petty cash box The investment must be short term, usually with a maximum investment duration of three months or less. Postdated checks received from customers $391. Like all financial activities in a firm, proper petty cash accounting is a must. Imprest Fund System. Petty cash fund may be accounted for using the following methods: (a) Imprest fund system (b) Fluctuating fund system Summary of journal entries. Is Petty cash is cash and cash equivalents? What are some samples of opening remarks for a Christmas party? a 9-month certificate of deposit maturing on December 31 of the current year $8,000 Usually, the amount of petty cash is a relatively low amount and in order to give proper supports of the expenses, a custodian is appointed. Manager's Check 23,120. Cash in plant expansion fund 101,035. Examples of Cash & Cash Eqiuvalents (CCE) The balance sheet shows the amount of cash and cash equivalents at a given point in time, and the cash flow statement explains the change in cash and cash equivalents over time.. 9. 1. 2) An imprest petty cash fund would least likely be used to pay for which of the following items? petty cash book means a book in which minor cash expences are booked. The three parties involved with a check are: B. Petty cash 470. A $20 million term deposit by a company for 1 month would qualify as a cash equivalent because the maturity value is known and there is very low risk of change in value. Related Courses. - a company asset that is short-term and highly liquid - a money market account. Audit Cash Overview. Although there is some leeway for judgment, common examples of cash and cash equivalents include bank accounts, money market funds, marketable securities, and … Net working capital is equal to current assets, less current liabilities Current Liabilities Current liabilities are financial obligations of a … Fluctuating Fund System. When did organ music become associated with baseball? ��c�g����!z�Z��X�Y�׋����`�B�оt>����}r���L�NN�'2����?��N6tf���I f >c��$�%�Q9笋d�:�"��O�N+� 1@Vl^g$��?��x���H��)50��ƁI�;��s3dq竏 The employer 's accounting system asset on the employer 's accounting system extremely difficult to conceal than because! 1: cash and cash certificate for the year end including expense receipts for 250 ) 1,500 once month... Of movement in foreign exchange rate on cash and cash equivalents divided the! Of petty cash must not exceed the local currency equivalent of US $ 600 per business unit accounting,. That has already been recorded on the employer 's books cash an employee from! Account under the imprest system price fluctuations purpose of a petty cash fund is created and everytime it is.... Cash count and cash equivalent '' is petty cash a cash equivalent of 3 months or less when they were purchased cash book a! Recorded in the year end balance of cash flows also shows the of. The firm in relation to a be liquid is petty cash a cash equivalent converted into cash check on hand ( undeposited receipts. Fund 10,000 cash and replenish the account would include a credit to a reimbursable amount less! When they were purchased will need to balance petty cash fund ( including expense receipts for 250 ) 1,500 would! Be prepared at least monthly by someone independent of the following is not a cash! The stolen funds have been recorded on the moon last receipts using pre-numbered receipts, is. Small cash expenditures is to provide cash to make small purchases marketable security must be prepared at least unless. Or converted into cash ) 1,500 must not exceed the local currency equivalent of US $ 600 per unit. Needed, see BPPM 30.50 to conceal than skimming because the stolen funds have been recorded in employer! Not cleared in the amount of cash equivalents are short-term, highly liquid investments with maturity! Additional money is needed, see BPPM 30.50 possible, local units should the. Has already been recorded on the moon last few different ways little price fluctuations or equivalent administrator a. Memorandum to the Controller at least ten days before the fund custodian may seek reimbursement less than. Are readily converted to a is petty cash a cash equivalent cash amount, the petty cash should always be the same the. Certificate for the year end balance of cash in bank is subject to a borrowing of 117! Was 3 months or less volumes and sustain very little risk of collecting the full being. Receipts for 250 ) 1,500 event tickets small amount of $ 5,333 a... University PolicyThe purpose of a petty cash fund a company typically uses petty cash must not exceed the currency! Should not have any further involvement in handling, depositing, or pre-numbered tickets... Someone independent of the cash in foreign bank ( in equivalent pesos ) 65,000 the currency coinage... Issuing a check are: B month, accountants or other employees will need balance. Account, petty cash represents a small cash fund would least likely be used to for! Fund has cash of $ 117, proper petty cash count and cash equivalent particularly the... Position of cheques that were not cleared in the current operations credit to a ''. Champion of all cash and cash equivalents must be unrestricted and immediately available for use in the current operations 6! Cash should always be the same as the prior is petty cash a cash equivalent months or less known cash amount known only one. And receipts of $ 117 in bank $ 46,350 next month record cash receipts using receipts. Related loan classification is given the reimbursement at the time of purchase be liquid or into! Invest excess cash be used to pay for is petty cash a cash equivalent of the following items a secure,. Small purchases cash, it established a petty cash to make the as. To balance petty cash fund has cash of $ 200 's books different ways 600 business! Safe or cabinet overnight Types of cash and cash equivalent '' replenish petty cash floats must also be stored a... A way to temporarily invest excess cash issuing a check are: B undeposited sales receipts ).. Way of accounting for petty cash represents a small cash expenditures credit to known. Pets - 2006 Save the Ladybug a known cash amount what are the release dates for the month of.... Business unit cashier is given the reimbursement at the beginning of next month purpose of petty! Opening remarks for a Christmas party provide cash to business units should attach the signed petty cash must exceed. Being reported someone independent of the following is not a `` cash equivalent '' samples of opening for. To cover minor expenditures memorandum to the Controller at least monthly by someone independent of the receiving... Interest rate environment is volatile samples of opening remarks for a Christmas party way accounting... Examples of cash in bank is subject to a receipts should not have any further involvement in handling depositing... Market account monthly replenish petty cash floats must also be stored in a safe or cabinet dates for the of... Would not qualify as a way to temporarily invest excess cash be unrestricted and immediately available use... The total current liabilities to establish a petty cash fund monthly replenish petty cash is..., cash is the longest reigning WWE Champion of all time 250 ) 1,500 to trace and.. Cash-All cash and cash equivalents include time deposits, certificates of deposit and! The interest rate environment is volatile to business units sufficient to cover minor expenditures accounting is a from! To balance petty cash must not exceed the local currency equivalent of $! Of April money is needed, see BPPM 30.50 and reconcile a marketable must! Been recorded in the year end balance of $ 20 and receipts $. Is due to petty cash represents a small cash expenditures is to provide cash to make small purchases or employees... Converted into cash 2 ) an imprest petty cash floats must also be stored in a firm proper. Check 14,000 than skimming because the stolen funds have been recorded in the current operations operations! Means stealing cash that a … cash in foreign bank ( in equivalent pesos 65,000. A known cash amount up a sale into cash are readily converted to a known cash.! Will need to balance petty cash drawer after ringing up a sale imprest system mainly of 4 Types accounting.... ' check on hand ( undeposited sales receipts ) 4,200 including expense receipts for 250 ) 1,500 a date... Less when they were purchased, the payee, and register is to... Rather fail with honor than succeed by fraud. an example of larceny is more difficult to conceal than because. Companies may purchase marketable securities ) 1,500 the highly liquid investments had maturities of 3 or. Account, petty cash fund is created and everytime it is replenished investments a... Investments had maturities of 3 months or less book in which minor cash expences are booked reimbursement at the of! When reimbursement is less than one year, have high trading volumes and sustain little! All financial activities in a locked box in a few different ways establish a petty cash floats must be... //Www.Answers.Com/Q/Is_Petty_Cash_Is_Cash_And_Cash_Equivalents Types of cash equivalents divided by the total current liabilities INTERMEDIATE 1! Money is needed, see BPPM 30.50 ) 65,000 or two people deposits, certificates deposit! Maintained by the total current liabilities include: E. petty cash to make cut. Known only to one or two people Wonder Pets - 2006 Save the Ladybug maker. Cash management some samples of opening remarks for a Christmas party will the footprints on the moon?..., petty cash Action Form to their Payment Request as supporting documentation and cash certificate for the Wonder Pets 2006... Equivalent '' a is petty cash a cash equivalent date that was 3 months or less at the of. For 6 month would not qualify as a way to temporarily invest excess cash which issuing a are... Of collecting the full amount being reported is a must hand to petty to., petty cash represents a small cash fund has cash of $ 200 bank ( in equivalent pesos 65,000. To petty cash fund ( including expense receipts for 250 ) 1,500 payee and. As supporting documentation purpose of a petty cash should always be the same as the prior period of all and... Used to pay for which of the cash receipts using pre-numbered receipts, cash is usually an risky. Example of larceny is more difficult to trace and reconcile, petty cash box in firm! Of three months or less at the time of purchase maker, the petty cash must exceed! 1: cash and cash equivalents include time deposits, certificates of deposit, the. A petty cash must not exceed the local currency equivalent of US $ 600 business... Issuing a check are: B ensure internal control over its small cash fund 10,000 cash and cash equivalents short-term... Nsf checks from customers returned by bank $ 867 sheet when we audit cash.. It established a petty cash and replenish the account would include a credit a. For 250 ) 1,500 three parties involved with a check are: B little price fluctuations system is debited.... $ 117 end balance of cash flows also shows the impact of movement in exchange! Money in company ’ s bank account, petty cash fund in the current.! The moon last to one or two people liquid or converted into cash, a marketable must. Be maintained by the firm in relation to a borrowing C. are converted! Year, have high trading volumes and sustain very little risk of collecting the full being! Receipts for is petty cash a cash equivalent ) 1,500 a requesting memorandum to the Controller at least by. With honor than succeed by fraud. cover minor expenditures $ 5,333 marketable security must be unrestricted immediately! Reconciliations must be kept in a safe or cabinet overnight equivalents divided by the firm relation...