The table below shows balance sheet data, in £m, for a phone-based bank, AndroidBank:£mloans to corporati ons50loans to households600300AndroidBank's holdings of shares and bonds, etcretail current account deposits (deposits by general public with AndroidBank)commercial current account deposits (deposits by companies with AndroidBank)tangible assets and property150050500cash in vaults50reserve deposits with Bank of England (deposits by AndroidBank)borrowing by AndroidBank in money market30025 Android Bank makes new consumer loans totalling £100Om, crediting the amount to itscustomers' accounts. Android Bank's net worth decreases by this amount.Select one:O TrueO False

Net worth means all value of assets held by entity less all value of liability held by entity.

Answered: Android Bank makes new consumer loans…

Android Bank makes new consumer loans totalling £100m, crediting the amount to its customers' accounts. Android Bank's net worth decreases by this amount. Select one: O True O False

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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Tom&Dick sells computer software. All credittransactions are done through credit cards, so there is a100% probability of receiving the money, but there is await of up to 10 days while the transaction is beingprocessed. When Tom&Dick prepares financialstatements at the end of its first business year, it should*a. exclude accounts receivable, because customersmay not pay b. include accounts receivable as an assetbecause of the matching principle c. exclude accountsreceivable as the amount is variable with interest ratesd. include accounts receivable as an asset because ofthe cost principle e. none of the above
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Consider two local banks. Bank A has 100 loans outstanding, each for $1.3 million, that it expects will be repaid today. Each loan has a 3% probability of default, in which case the bank is not repaid anything. The chance of default is independent across all the loans. Bank B has only one loan of $130 million outstanding, which it also expects will be repaid today. It also has a 3% probability of not being repaid. Calculate the following: a. The expected overall payoff of each bank. b. The standard deviation of the overall payoff of each bank. a. The expected overall payoff of each bank. The expected overall payoff of Bank A is $☐ million. (Round to two decimal places.)
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