Monetary Items

monetary items

Assets on a firm's balance sheet that are fixed in dollar amount. Cash, short-term loans, and long-term bonds are monetary items.

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Monetary Items

Assets and liabilities that are fixed in dollar amounts and are thus not affected by inflation. Examples of monetary items include cash, accounts receivable, accounts payable, bonds, and short-term loans. In periods of high inflation, holding monetary liabilities increases a firm's purchasing power, while holding monetary assets decreases it.