The average daily net transaction accounts of a local bank during the most recent reserve computation period is $332 million. The amount of average daily reserves at the Fed during the reserve maintenance period is $25.30 million, and the average daily vault cash corresponding to the maintenance period is $4.5 million. a. Under the rules effective in 2013, what is the average daily reserve balance required to be held by the bank during the maintenance period? b. Is the bank in compliance with the reserve requirements? Complete this question by entering your answers in the tabs below. Required A Required B Under the rules effective in 2013, what is the average daily reserve balance required to be held by the bank during the maintenance period? (Do not round intermediate calculations. Enter your answer in millions rounded to 3 decimal places. (e.g., 32.161)) Average daily reserve required $ 2.537 million

The average daily net transaction accounts of a local bank during the most recent reserve computation period is $332 million. The amount of average daily reserves at the Fed during the reserve maintenance period is $25.30 million, and the average daily vault cash corresponding to the maintenance period is $4.5 million. a. Under the rules effective in 2013, what is the average daily reserve balance required to be held by the bank during the maintenance period? b. Is the bank in compliance with the reserve requirements? Complete this question by entering your answers in the tabs below. Required A Required B Under the rules effective in 2013, what is the average daily reserve balance required to be held by the bank during the maintenance period? (Do not round intermediate calculations. Enter your answer in millions rounded to 3 decimal places. (e.g., 32.161)) Average daily reserve required $ 2.537 million

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Similar questions

Assume the Bank of Smallville opens its doors to depositors and receives $100,000 in cash deposits. a) Prepare a balance sheet for Bank of Smallville based on the above information. b) Assume furthermore that the bank has to abide by a 20% reserve ratio. How much in excess reserves does the bank hold? Could this bank make a loan in the amount of $90,000? Briefly explain. c) Based on the amount of excess reserves, if the bank makes the loans, show the immediate impact on the Bank of Smallville's balance sheet. d) Calculate value of the money multiplier? e) How much money would be created in the banking system if other banks also lend as much as possible? Part B a) What is meant by the term "excess supply of money?" How does the money market resolve this disequilibrium? b) Explain with diagrams, what happens to the money supply, interest rates, investment spending and GDP when the central bank makes open market purchases.
Given below is the balance sheet for the Bank of New Providence: Assets ($1,000,000s) Liabilities ($1,000,000s) Cash 52 Deposits 650 T-bills and Bonds 257 Long-term debt 326 Loans to Other Banks 95 Equity 88 Commercial Loans 364 Mortgages 296 Total 1,064 Total 1,064 The net profit for the bank was $10.3 million. A required reserve is specified at 5% of deposits. What is the Bank's EM?
Question: Given below is the balance sheet for the Bank of New Providence: Assets ($1,000,000s) Liabilities ($1,000,000s) Cash 52 Deposits 650 T-bills and Bonds 257 Long-term debt 326 Loans to Other Banks 95 Equity 88 Commercial Loans 364 Mortgages 296 Total 1,064 Total 1,064 The net profit for the bank was $10.3 million. A required reserve is specified at 5% of deposits. What is the bank's ROA?
The accountant of ABC has collected the following information for the month of July 2019. ABC’s bank statement for July 2019 shows the following data: Balance on 1 July as per bank $29,500 Balance on 31 July as per bank $15,907.45 The cash balance as per company records as of July 31 is $11,589.45. Further review of the data reveals the following information: Errors: Check no115 for $1,226. The bank correctly paid the amount, but ABC recorded the check as $1,262. Outstanding checks on July 31, total $5,904 Deposits in transit on July 31 total $2,201.40 Bank statement shows: A. Debit-NSF check: $425.60 B. Debit-bank fee $30 C. Credit- collection of note receivable for $1,000 plus interest earned $50 and bank collection fee $15. Required:Prepare bank reconciliation on July 31, 2019.
Bank reconciliation and entriesThe cash account for Coastal Bike Co. at October 1, 2019, indicated abalance of $5,140. During October, the total cash deposited was $39,175,and checks written totaled $40,520. The bank statement indicated abalance of $8,980 on October 31, 2019. Comparing the bank statement,the canceled checks, and the accompanying memos with the recordsrevealed the following reconciling items: A. Checks outstanding totaled $5,560.B. A deposit of $1,050 representing receipts of October 31 had beenmade too late to appear on the bank statement.C. The bank had collected for Coastal Bike Co. $2, 120 on a note leftfor collection. The face of the note was $2,000. D. A check for $370 returned with the statement had beenincorrectly charged by the bank as $730.E. A check for $310 returned with the statement had been recordedby Coastal Bike Co. as $130. The check was for the payment of anobligation to Rack Pro Co. on account. F. Bank service charges for October amounted to $25.G. A…
The following details are found in the incomplete bank reconciliation statement of Phillip Company for the month ended September 30, 2021: Notes payable charged by the bank- 150,000 Service Charge- 35,000 Deposits in Transit- 250,000 Outstanding Checks- 350,000 Balance per bank statement- 325,000 Deposit erroneously recorded by Phillip as 37,500 instead of 57,800 What is the reconciled cash to be reported by Phillip Company?
The Cash account of ReeseCorporation had a balance of $3,540 at October 31, 2018. Included were outstanding checkstotaling $1,800 and an October 31 deposit of $300 that did not appear on the bank statement.The bank statement, which came from Turnstone State Bank, listed an October 31 balance of$5,570. Included in the bank balance was an October 30 collection of $600 on account froma customer who pays the bank directly. The bank statement also showed a $30 service charge,$10 of interest revenue that Reese earned on its bank balance, and an NSF check for $50.Prepare a bank reconciliation to determine how much cash Reese actually had at October 31.
A bank has the following balance sheet. It expects a net deposit drain of $500,000. Assets Liabilities and Equity Cash $300,000 Deposits $3,115,000 Loans 2,000,000 Equity 385,000 Securities 1,200,000 Total Asset $3,500,000 Total Liabilities and Equity $3,500,000 What is a net deposit drain and why is it of concern for the bank? Show the bank’s balance sheet if it uses stored liquidity to offset the expected drain.
A local bank policy is to hold 12.77% of its deposits as reserves. With current deposits of $8 million and excess reserves of $200,000, calculate the necessary reserve on a fresh deposit of $30,000. Required reserve for new deposit =$ (The answer should be rounded to Zero (0) decimals without the $ sign.)
The cash in bank account of Romeo Co. for april 2020 showed an ending balance of $193947. Deposit in transit on April 30 was $27300. Outstanding checks as of April 30 were $89152.5 including $7500 certified check which the bank has certified on April 27. During the month of April, the bank charged back NSF checks in the amount $5152.5 which 2752.5 had been redeposited by April 20. On April 23, the bank charged Romeo's account $3300 items which have been charged to Rina's Account the error was not detected by the bank. During April, the proceeds from notes collected by the bank for Romeos co was $11322 and bank charges for this services $27 there are not yet recorded by the book. How much is unadjusted balance per bank on April 30? Answ: $253894.5 Romeo company purchased 150000 shares 5% ownership of Blue company on January 14, 2022. Romeo received a share dividend of 8% on March 31, 2022 when the market price of share is $25. On December 14, 2022, Romeo received a cash dividend of $20…
The Richard’s Red Company maintains a checking account at the Bank of the North. The bank statement for the month of October 2024 indicated the following: balance on October 1, 2024 was $32,690, deposits for October totaled $86,000, checks paid in October totaled $75,200, service charges for October totaled $350; October NSF checks totaled $1,600; a monthly loan payment deducted by the bank directly from the company’s bank account totaled $3,400; and the ending balance on October 31, 2024 totaled $38,140. At the end of October 2024, Richard’s accounting records indicated a balance in its checking account of $42,544. October 31st deposits in transit were $4,224, and outstanding checks totaled $5,620. In addition, a check for $500 to purchase office furniture was incorrectly recorded by the company as a $50 disbursement. The bank correctly processed the check during October. Assuming the company has no other cash, the amount Richard’s Red would report for cash as a current asset on…
On July 31, 2022, Carla Vista Co. had a cash balance per books of $6,335.00. The statement from Dakota State Bank on that date showed a balance of $7,885.80. A comparison of the bank statement with the Cash account revealed the following facts. 1. The bank service charge for July was $19.00. 2. The bank collected $1,715.00 from a customer for Carla Vista Co. through electronic funds transfer. 3. The July 31 receipts of $1,394.30 were not included in the bank deposits for July. These receipts were deposited by the company in a night deposit vault on July 31. 4. Company check No. 2480 issued to L. Taylor, a creditor, for $374.00 that cleared the bank in July was incorrectly entered in the cash payments journal on July 10 for $347.00. 5. Checks outstanding on July 31 totaled $2,046.10. 6. On July 31, the bank statement showed an NSF charge of $770.00 for a check received by the company from W. Krueger, a customer, on account.…