The bank that you own has the following balance sheet: Assets Liabilities $ 60 million Deposits $120 million Bank capital $420 million Reserves $500 million $100 million Securities Loans a) Record a bookkeeping immediately after the bank suffers a deposit outflow of $50 million when a required reserve ratio on deposits is 10%. What problem do you see on the T-account after the event? Assets Liabilities Reserves Deposits Bank capital Securities Loans b) What action(s) you want to take to rectify the situation? Make your suggestion(s) in terms of the T-account and explain them. Assets Liabilities

The bank that you own has the following balance sheet: Assets Liabilities $ 60 million Deposits $120 million Bank capital $420 million Reserves $500 million $100 million Securities Loans a) Record a bookkeeping immediately after the bank suffers a deposit outflow of $50 million when a required reserve ratio on deposits is 10%. What problem do you see on the T-account after the event? Assets Liabilities Reserves Deposits Bank capital Securities Loans b) What action(s) you want to take to rectify the situation? Make your suggestion(s) in terms of the T-account and explain them. Assets Liabilities

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) Bank A has the following balance sheet (in millions): Assets Cash Securities Loans Total assets $70 The bank is expecting a $12 million net deposit drain. Liabilities and equity Deposits Equity Total liabilities and equity $5 10 55 $62 9 $70 ii) Show the new balance sheet if the bank uses stored liquidity management to offset the expected drain. Also, explain the effect on the size and composition of assets and liabilities.
a) Bank A has the following balance sheet (in millions): Assets Cash Securities Loans Total assets $5 10 55 $70 Liabilities and equity Deposits Equity Total liabilities and equity The bank is expecting a $12 million net deposit drain. $62 8 $70 i) Show the new balance sheet if the bank uses purchased liquidity management to offset the expected drain. Also, explain the effect on the size and composition of assets and liabilities ii) Show the new balance sheet if the bank uses stored liquidity management to offset the expected drain. Also, explain the effect on the size and composition of assets and liabilities.
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.
2. Your bank has the following balance sheet: Assets Reserves Securities Loans Liabilities Checkable deposits $200 million Bank capital 50 million If the required reserve ratio is 10%, what actions should the bank manager take if there is an unexpected deposit outflow of $50 million? Make sure to show your work. $50 million 50 million 150 million
Interest on your bank balance: Suppose your bank account has a balance todayof $100. Consider the following time periods: t = 0, t = 1, t = 2, t = 12,t = 24, t = 48, and t = 60. Assume there are no deposits or withdrawalsin this account other than the interest that accumulates. (If you like, use aspreadsheet program to help you with this question.)(a) Compute your bank balance for these time periods assuming the interestrate is 1%.(b) Do the same thing for an interest rate of 6%.(c) Plot your bank balances for these two scenarios on a standard scale.(d) Do the same thing with a ratio scale.
The whole task is attached in the photo
Nearby Bank has the following balance sheet (in millions): Assets Liabilities and Equity Cash $60 Demand deposits $140 5-year T notes $60 1-year CD $160 30-year mortgages $200 Equity $20 Total Assets $320 Total L and E $320 What is the maturity gap for Nearby Bank?
Problem Solving. 1. Assuming the following information for Uno Company: bank balance P65,000; book balance ? ; deposit in transit P11,000; outstanding check P10,000; credit memo P2,000; and debit memo P500. How much is the adjusted bank balance?
Find the attached file.
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Below is the balance sheet for a bank. Under "Other" it has listed "$X" just think of this as the dollar amount needed to make the balance sheet balance. It is not important what that value is for this question. AssetsLiabilitiesReserves 40Deposits 215Loans 160 Securities 40Other $X Using the balance sheet above, find the level of excess reserves this bank is holding if the required reserve ratio = 8%(Give answers to 2 decimal places as needed)