2. RWC Incorporated has a monthly ledger balance and deposit float of $200,000 and $25,000, respectively. Regions Bank pays RWC an earnings credit rate of 40 basis points, the reserve requirement ratio is 10%, and there are 30 days in the month. If service charges of $500 are incurred, what is the net service charge applied to RWC’s demand deposit account? To have no net service charge debited from the account, what must the account holdings be in RWC’s demand deposit account?
2. RWC Incorporated has a monthly ledger balance and deposit float of $200,000 and $25,000, respectively. Regions Bank pays RWC an earnings credit rate of 40 basis points, the reserve requirement ratio is 10%, and there are 30 days in the month. If service charges of $500 are incurred, what is the net service charge applied to RWC’s demand deposit account? To have no net service charge debited from the account, what must the account holdings be in RWC’s demand deposit account?
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Question
2. RWC Incorporated has a monthly ledger balance and deposit float of $200,000 and $25,000, respectively. Regions Bank pays RWC an earnings credit rate of 40 basis points, the reserve requirement ratio is 10%, and there are 30 days in the month. If service charges of $500 are incurred, what is the net service charge applied to RWC’s demand deposit account? To have no net service charge debited from the account, what must the account holdings be in RWC’s demand deposit account?
Expert Solution
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
This is a popular solution!
Trending now
This is a popular solution!
Step by step
Solved in 3 steps
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.Recommended textbooks for you
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Horngren's Cost Accounting: A Managerial Emphasis…
Accounting
ISBN:
9780134475585
Author:
Srikant M. Datar, Madhav V. Rajan
Publisher:
PEARSON
Intermediate Accounting
Accounting
ISBN:
9781259722660
Author:
J. David Spiceland, Mark W. Nelson, Wayne M Thomas
Publisher:
McGraw-Hill Education
Financial and Managerial Accounting
Accounting
ISBN:
9781259726705
Author:
John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles
Publisher:
McGraw-Hill Education