商业银行Chapter-5-homework1

1、Chapter 5Multiple Choice Questions1. The noncash expense item on a banks Report of Income designed to shelter a banks current earnings from taxes and to help prepare for bad loans is called:DA) Short-term debt interestB) Noninterest expenseC) Provision for taxesD) Provision for possible loan lossesE

2、) None of the above.2 Banks depend heavily upon borrowed funds supplied by customers with little owners capital invested. This means that banks make heavy use of:AA) Financial leverageB) Capital restructuringC) Operating LeverageD) Margin borrowingE) None of the above.3. Large U.S. banks must use wh

3、ich of the methods listed below to determine their provision for loan loss expense? CA) Experience methodB) Reserve methodC) Specific charge-off methodD) Historical cost methodE) None of the above.4. A banks temporary lending of excess reserves to other banks is labeled on the balance sheet as:BA) F

4、ed Funds PurchasedB) Fed Funds SoldC) Money Market DepositsD) Securities Purchased for ResaleE) None of the above5. A bank sells shares of its common stock with a par value of $100 for $200 in the market. Which two accounts on the banks balance sheet are going to be affected? DA) Retained earnings a

5、nd capital surplus accountsB) Subordinated notes and debentures and commons stock outstanding accountsC) Retained earnings and common stock outstanding accountsD) Common stock outstanding and capital surplus accountsE) Only the common stock outstanding account is affected6. A bank which starts with

6、ALL of $1.48 million at the beginning of the year, charges off worthless loans of $.94 million during the year, recovers $.12 million on loans previously charged off and charges current income for a $1.02 million provision for loan losses will have an ALL at the end of the year of: BA) $.66 millionB

7、) $3.32 millionC) $1.68 millionD) $1.28 millionE) The same amount as at the beginning of the year7. A bank that has total interest income of $67 million and total noninterest income of $14. million. This bank has total interest expenses of $35 million and total noninterest expenses (excluding PLL) o

8、f $28 million. Its provision for loan losses is $6 million and its taxes are $5. What is this banks net income? AA)$7B)-$14C)$18D)$32E)None of the above8. You know the following information about the Miller State Bank Gross Loans $300 Miscellaneous Assets $50 Deposits $390 Total Equity$50Common Stoc

9、k Par$5NonDeposit Borrowings $60 Investment Securities $150 Net Premises$40Surplus$5Allowance for Loan Losses $50 Deposits $390 Total Assets$500Gross Premises$70Given this information, what is this firms?As Net LoanA)$250B)$350C)$500D)$50E)$1509. You know the following information about the Davis Na

10、tional BankTotal Interest Expenses($500)Total Non Interest Income$100Securities Gains (Losses)$ 50Income Taxes($ 80)Dividends to Stockholders($ 40)Total Interest Income$800Total Non Interest Expenses($150)Provision for Loan Losses($100)Given this information, what is this firm s NDet Income?A) $300B

11、) $150C) ($50)D) $120E) $8010. You know the following information about the Webb State Bank Accumulated Depreciation $40Net Loans$600Fed Funds Purchased and Repurchase Agreements $200$50$40$100$500$140$90$40$100$160$20$700 s ToAtal Assets?Cash and Due from BanksTrading Account Securities Miscellaneo

12、us Assets DepositsUndivided Profits Gross PremisesSurplusSubordinated DebtInvestment SecuritiesCommon Stock ParGross LoansGiven this information, what is this firmA)$1000B)$300C)$800D)$200E)$500Problems5-4 If you know the following figures:Gross LoansAllowance for Loan LossesFederal Funds SoldCommon

13、 StockSurplusTotal Equity CapitalCash and Due from Banks Miscellaneous Assets300 Trading Account Securities215 Other Real Estate Owned426 Goodwill and other Intangibles312 Total Liabilities38019 Preferred Stock349 Nondeposit Borrowings209 Bank Premises and Equipment, Net2938Bank Premises and Equipme

14、nt, Gross34Please calculate these items:Total AssetsNet LoansUndivided ProfitInvestment SecuritiesDepreciationTotal Deposits5-5.Hokie High Bank has Gross Loans of $550 million with an ALL account of $30 million.Two years ago the bank made a loan for $10 million to finance the Hokie Hotel.One million

15、 dollarsin principal was repaid before the borrowers defaulted on the loan.The Loan Committee at HokieHigh Bank believes the hotel will sell at auction for $7 million and they want to charge-off the remainder immediately.a. The dollar figure for Net Loans before the charge-offis ?b. After the charge

16、-off, what are the dollar figures for Gross Loans, ALL and Net Loans assuming no other transactions.c. If the Hokie Hotel sells at auction for $8 million, how with the affect the pertinent balance sheet accounts?5-9. See if you can determine the amount of Rosebush State Bank s current net income after taxesfrom th