Nikul Smallville Bank has the following balance sheet, rates earned on its assets, and rates paid on its liabilities.AssetsBalance Sheet (in thousands)Cash and due from banksInvestment securitiesRepurchase agreementsLoans less allowance for lossesFixed assetsOther earning assetsLiabilities and EquityTotal assetsDemand depositsNOW accountsRetail CDsTotal liabilitiesCommon stockSubordinated debenturesPaid-in capital surplusRetained earningsRate Earned (%)$ 7,700039,000729,000597,000927,0005,00008$ 204,700Rate Paid (%)$ 15,00086,0000435,000631,0007167,00020,0004,70013,000Total liabilities and equity$ 204,700If the bank earns $137,000 in noninterest income, incurs $97,000 in noninterest expenses, and pays $2,670,000 in taxes, what is itsnet income? (Enter your answer in dollars, not thousands of dollars.)Net income

To calculate for the net income Step 1 : Calculate the interest incomeInterest Income = (Investment…

Answered: Smallville Bank has the following…

Principles of Accounting Volume 1

19th Edition

ISBN:9781947172685

Author:OpenStax

Publisher:OpenStax

Chapter12: Current Liabilities

Section: Chapter Questions

Problem 3MC: The following is selected financial data from Block Industries: How much does Block Industries have...

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Examine the balance sheet of commercial banks in the tollowing tabie. Assete S Blion Total Liabilities and Net Horth SBAllion Total Liabilities Real anseta Equipment and premisen Other real estate $ 10,281.3 1,206.0 156.2 0.9 Deposita Debt and other borroved funda Federal funda and repurehase 56.0 8.9 0.4 1.0 Total real assets 225.1 1.2 1,967.0 10.7 agreements Other 1,523.0 S 15,057.3 8.3 82.0 Total liabilities Tinaneial aeta Cash 898.3 4.9 43.7 34. 1,223.2 6.? 92.1 8,032.1 6,759.3 Investment securities Loans and leaees Other finaneial asseta Total financial asseta 16,912.9 Other assets Intangible asseta other Total other asseta 421.4 2.3 1,230.1 1.4 6.7 $ 3,310. 18,368.1 100.0 Net vorth 18.0 $ 18,368.1 100.0 Total Balance sheet of FDIC-insured commercial banks and savings institutions Note: Column sums may differ from total because of rounding error. Source: Federal Deposit Insurance Corporation, www.fdic.gov, March 2016. a. What is the ratio of real assets to total assets? (Round…
The financial statements for BSW National Bank (BSWNB) are shown below: What is the dollar value of earning assets held by BSWNB? What is the dollar value of interest-bearing liabilities held by BSWNB? What is BSWNB’s total operating income? Calculate BSWNB’s asset utilization ratio. Calculate BSWNB’s net interest margin.
Analyse the effect of the actions below on the debt/equity ratio. Assume current debt/equity ratio is 0.5. (v) Issuing new equity (vi) Account receivable collected (vii) Sell goods on book value, on cash basis (viii) Pay off the company’s long term bank loan
The _____ ratio gives actual losses on loans, while the ______ ratio gives the extent to which the bank’s assets are devoted to loans. a. loss rate; capitalization b. loss rate; loan risk c. loan risk; loss rate d. operating efficiency; loan risk
Consider a bank with the following balance sheet (Shown in image):a) Calculate the equity (total asset – total liability) to asset ratio of the bank(Hint: equity to asset ratio = total equity/total asset) b) Calculate the duration and convexity of the both asset and liability sides; c) If the interest rates go up by 1%, using the duration and convexity rule to determine the networth of the bank and the equity to asset ratio; d) In c)’s scenario, to maintain the equity to asset ratio at 40% which is required by the regulation,the bank decides to raise cash (zero duration and zero convexity) from the equity holders.How much cash does the bank need to raise? e) Do you agree with the following statement? Explain why. “The information about a bond’s duration and convexity adjustment is sufficient to quantifyinterest rate risk exposure.”
The financial statements for First National Bank (FNB) are shown below: Balance Sheet First National Bank Assets Cash Demand deposits from other FIS Investments Federal funds sold Loans Reserve for loan losses. Premises Total assets $ 540 1,800 4,500 2,295 16,425 (2,025) 2,135 $25,670 Income Statement First National Bank. Interest income Interest expense Provision for loan losses Noninterest income Noninterest expense Taxes a. FNB's earning assets b. FNB's ROA c. FNB's asset utilization ratio d. FNB's spread $3,050 2,020 270 230 510 90 Liabilities and Equity Demand deposits Small time deposits. Jumbo CDs Federal funds purchased Equity Total liabilities/equity % % % $ 5,570 11,100 3,650 2,700 2,650 a. Calculate the dollar value of FNB's earning assets. b. Calculate FNB's ROA. (Round your answer to 2 decimal places. (e.g., 32.16)) c. Calculate FNB's asset utilization ratio. (Round your answer to 2 decimal places. (e.g., 32.16)) d. Calculate FNB's spread. (Round your answer to 2 decimal…
The current ratio is O a solvency measure that indicates the margin of safety for bondholders O calculated by dividing current liabilities by current assets calculated by subtracting current liabilities from current assets O used to evaluate a company's liquidity and short-term debt-paying ability Question 19 On the statement of cash flows, a $9,000 gain on the sale of fixed assets would be O added to net income in converting the net income reported on the income statement to cash flows from operating activities O deducted from net income in converting the net income reported on the income statement to cash flows from operating activities O deducted from dividends declared in converting the dividends declared to the cash flows from financing activities related to dividends O added to dividends declared in converting the dividends declared to the cash flows from financing activities related to dividends
The financial statements for MHM Bank (MHM) are shown below: Assets Cash and due from banks Demand deposits at other FIS Investments Federal funds sold Loans (less reserve for loan losses of 3,400) Premises Total assets Income Statement MHM Bank Interest income Interest expense Provision for loan losses Noninterest income Noninterest expense Taxes a. MHM's earning assets b. MHM's interest-bearing liabilities Balance Sheet MHM Bank $ 2,020 2,100 6,280 3,090 20,260 2,370 $36, 120 C. MHM's spread d. MHM's interest expense ratio $ 4,258 2,224 1,100 800 1,075 335 Liabilities and Equity a. Calculate the dollar value of MHM's earning assets. b. Calculate the dollar value of MHM's interest-bearing liabilities. c. Calculate MHM's spread. (Do not round intermediate calculations. Round your percentage answer to 3 decimal places. (e.g., 32.161)) d. Calculate MHM's interest expense ratio. (Round your percentage answer to 3 decimal places. (e.g., 32.161)) % % Demand deposits Small time deposits…
The financial statements for MHM Bank (MHM) are shown below: Calculate the dollar value of MHM’s earning assets. Calculate the dollar value of MHM’s interest-bearing liabilities. Calculate MHM’s spread. Calculate MHM’s interest expense ratio.
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a)Calculate the equity (total asset –total liability) to asset ratio of the bank (Hint: equity to asset ratio = total equity/total asset) b)Calculate the duration and convexity of the both asset and liability sides; c)If the interest rates go up by 1%, using the duration and convexity ruleto determine the net worth of the bank and the equity to asset ratio; d)In c)’s scenario, to maintain the equity to asset ratio at 40% which is required by the regulation, the bank decides to raise cash (zero duration and zero convexity) from the equity holders. How much cash does the bank need to raise? e)Do you agree with the following statement? Explain why.“The information about a bond’s duration and convexity adjustment is sufficient to quantify interest rate risk exposure.” please can you answer part d and e
The following is selected financial data from Block Industries: How much does Block Industries have in current liabilities? A. $19,800 B. $18,300 C. $12,300 D. $25,800

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