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After reading the new account insert in his monthly statement, Tony Mercadante determined that the FDIC considers a joint account as a separate depositor. He and his wife, Cynthia, have three accounts at ABC Bank & Trust, one joint account with a balance of $73,842 and two individual accounts-his has a $132,699 balance, and hers has a $252.088 balance. What amount of FDIC coverage do Tony and Cynthia have on their accounts?

After reading the new account insert in his monthly statement, Tony Mercadante determined that the FDIC considers a joint account as a separate depositor. He and his wife, Cynthia, have three accounts at ABC Bank & Trust, one joint account with a balance of $73,842 and two individual accounts-his has a $132,699 balance, and hers has a $252.088 balance. What amount of FDIC coverage do Tony and Cynthia have on their accounts?

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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After reading the new account insert in his monthly statement, Tony Mercadante determined that the FDIC considers a joint account as a separate depositor. He and his wife, Cynthia, have three accounts at ABC Bank & Trust, one joint account with a balance of $73,842 and two individual accounts-his has a $132,699 balance, and hers has a $252,088 balance. What amount of FDIC coverage do Tony and Cynthia have on their accounts? What amount of FDIC coverage do Tony and Cynthia have on their accounts? (Select the best answer below.) A Tony's account balance of $132.699 is completely covered as is their joint account of $73,842; both accounts are under the $250,000 FDIC limit. Cynthia's account is over the insurance limit by $2,088, but their money would be covered if she moved some into their joint account or into another institution. B. Tony's account balance of $132.699 is completely covered as is their joint account of $73,842; both accounts are under the $250,000 FDIC limit. Cynthia's account is over the insurance mit by $2,088, but is fully insured because they only have $73.642 in their joint account OC. Tony and Cynthia have a total of $458,629 in this institution. Each institution is insured up to $250,000, so they are over the insurance limit by $208,629 and should move money into other institutions OD. Tony's account balance of $132.699 is not covered and neither is their joint account of $73,842. This is because Cynthia's account balance of $252,088 is over the insurance limit by $2,088, therefore the institution does not have to insure any of their accounts.
Transcribed Image Text:After reading the new account insert in his monthly statement, Tony Mercadante determined that the FDIC considers a joint account as a separate depositor. He and his wife, Cynthia, have three accounts at ABC Bank & Trust, one joint account with a balance of $73,842 and two individual accounts-his has a $132,699 balance, and hers has a $252,088 balance. What amount of FDIC coverage do Tony and Cynthia have on their accounts? What amount of FDIC coverage do Tony and Cynthia have on their accounts? (Select the best answer below.) A Tony's account balance of $132.699 is completely covered as is their joint account of $73,842; both accounts are under the $250,000 FDIC limit. Cynthia's account is over the insurance limit by $2,088, but their money would be covered if she moved some into their joint account or into another institution. B. Tony's account balance of $132.699 is completely covered as is their joint account of $73,842; both accounts are under the $250,000 FDIC limit. Cynthia's account is over the insurance mit by $2,088, but is fully insured because they only have $73.642 in their joint account OC. Tony and Cynthia have a total of $458,629 in this institution. Each institution is insured up to $250,000, so they are over the insurance limit by $208,629 and should move money into other institutions OD. Tony's account balance of $132.699 is not covered and neither is their joint account of $73,842. This is because Cynthia's account balance of $252,088 is over the insurance limit by $2,088, therefore the institution does not have to insure any of their accounts.
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