Bank Balance SheetAssetsAmountLiabilitiesTotal reservesLoans$ 80,000120,000Transactions accountsAmount$ 200,000With a required reserve ratio of 10 percent, this bank would have excess reserves ofMultiple ChoiceО$40,000.О$20,000.none of the aboveО$60,000.

Required reserves are the minimum amount of money that a commercial bank must hold in reserve. The…

Answered: Bank Balance Sheet Assets Amount…

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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A new bank has vault cash of $2 million and $6 million in deposits held at its Federal Reserve District Bank.If the required reserves ratio is 9 percent, what dollar amount of deposits can the bank have?
The table below is the balance sheet for the Oilers Bank, which has a target reserve ratio of 5%. Liabilities/Equity Demand Deposits Shareholders' equity Assets $4,000 62,000 17,000 9,000 Reserves $72,000 20,000 Loans Securities Fixed assets Total 92,000 Total 92,000 a. The Oilers Bank is over-reserved v by $ b. The bank makes a loan equal to the excess reserves and the borrower writes a cheque (for the full amount of the loan) to another customer of the bank, who then deposits it. The new amount of excess reserves is $ c. Instead, the cheque written by the borrower is cleared against the Oilers Bank (the cheque was written to a customer of another bank). The amount of excess reserves held by the Oilers Bank is $ 14 of 40 Next > < Prev
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Show new balance sheet if bank uses purchased liquidity management to offset expected drain of $12 million net deposit. Also explain effect on the size and composition of assets and liab
Bank two currently has $500 million in transaction deposits. The bank has $65 million in reserves. The and its Federal reserve requirement ratio is 12%. The bank's required reserves are excess reserves are A. $60 million; $0. B. $60 million; $5 million. C. $440 million; $5 million. D. $600 million; $60 million.
Consider a bank with the following balance sheet: Assets Required reserves $10 Excess reserves $27 Loans $70 Required reserves Excess reserves Loans million million million $ $ $ Assume that required reserves are 8%. In order to avoid insolvency, regulators decide to provide the bank with $27 million in bank capital. Assume that bad news about mortgages is featured in the local newspaper, causing a bank run. As a result, $40 million in deposits is withdrawn. Show the effects of the capital injection and bank run on the balance sheet. (Round your responses to the nearest whole number.) Assets Liabilities Checkable deposits Bank capital million million million Liabilities $120 million - $13 million Checkable deposits Bank capital $ $ million million
Tam attended Brown University during 2017-2021. She lived at home and was claimed by her parents as a dependent during her entire education. She incurred education expenses of $10,000 during college, of which $2,000 was paid for by scholarships. To finance her education, she borrowed $6,000 through a federal student loan program and borrowed another $4,000 from a local lending institution for educational purposes. After graduation, she married and moved with her spouse to a distant city. In 2022, she incurred $600 of interest on the federal loans and $400 on the lending institution loan. She filed a joint return with her spouse showing modified AGI of $138,000. Required: What amount of student loan interest can Tam and her spouse deduct in 2022, if any?

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Bank Balance Sheet Assets Amount Liabilities Total reserves Loans $ 80,000 120,000 Transactions accounts Amount $ 200,000 With a required reserve ratio of 10 percent, this bank would have excess reserves of Multiple Choice $40,000. $20,000. none of the above $60,000.