商业银行管理彼得S.罗斯英文原书第8版-英语试题库Chap005

Chapter5

TheFinancialStatementsofBanksandTheirPrincipalCompetitors

FillintheBlankQuestions

1. Fedfundspurchasedisanexampleof_______________________alongwithEurodollarborrowings.

Answer:nondepositborrowings

2. Theshorttermsecuritiesofthebank,includingT-Billsandcommercialpaper,areoftencalled__________________________becausetheyarethesecondlineofdefensetomeetdemandsforcash.

Answer:secondaryreserves

3. __________________________isanoncashexpenseonthebank'sincomestatementwhichallowsthebanktoaccountforfuturebadloans.

Answer:Provisionforloanlosses

4. __________________________isthedifferencebetweeninterestincomeandinterestexpensesforafinancialinstitution.

Answer:Netinterestincome

5. __________________________aretheprimarylongtermliabilitiesofthebank.Theseliabilitiesarepaidonlyafterdepositshavebeenpaidintheeventofbankruptcy.

Answer:Subordinatednotesanddebentures

6. A(n)__________________________iswherethefinancialinstitutionagreestoguaranteerepaymentofacustomer'sloanreceivedfromathirdparty.

Answer:standbycreditagreement

7. A(n)__________________________isashorttermcollateralizedloan.ThecollateralthatisusedgenerallyconsistsofT-Bills.

Answer:repurchaseagreement

8. A(n)__________________________isadepositaccountwhichpaysaninterestratecompetitivewithmoneymarketmutualfundsandwhichgenerallyhaslimitedcheckwritingability.

Answer:moneymarketdepositaccount

9. _____________________isthesumofalloutstandingIOU'sowedtothebankintheformofconsumer,realestate,commercialandagricultureloansaswellasothertypesofcreditextensions.

Answer:grossloans

10. Afinancialinstitutionoftenrecordsthevalueofitsassetsandliabilitiesat_______________whichistheoriginalorhistoricalcostoftheasset.

Answer:bookvalue

11. Theprincipaltypesof__________________________includefeeincome,incomefromfiduciaryactivitiesandserviceschargesondeposits.

Answer:noninterestincome

12. The__________________________showstheamountofrevenuesreceivedandexpensesincurredoveraspecifictimeperiod.

Answer:ReportofIncome(incomestatement)

13. The__________________________liststheassets,liabilitiesandequitycapitalheldbythebankonagivendate.

Answer:ReportofCondition(balancesheet)

14. ______________islabeled"AccountingforDerivativeInstrumentsandHedgingActivities."

Answer:FASB133

15. ________________labeled“AccountingforDerivativeInstrumentsandHedgingActivities〞anditsrecentamendments,FASB138,aredesignedtomakederivativesmorepubliclyvisibleoncorporatefinancialstatements.

Answer:FASB133

16. Under_____________banksmustaccountfortheexpectedlossofinterestincomeonnonperformingloanswhencalculatingtheirloan-lossprovision.

Answer:FASB114

17. Temporarilybuyingandsellingsecuritiesbyasecuritiesfirminathinlytradedmarketsoastoinfluencethepriceisknownas_________________.

Answer:paintingthetape

18. Theactivityofmanipulatingthefinancialstatementstoartificiallyenhancethebanksfinancialstrengthisknownas___________________.

Answer:windowdressingor‘creativeaccounting’

isdirectandindirectinvestmentinrealestate.Thesearepropertiesobtainedforcompensationsfornonperformingloans.

Answer:OtherRealEstateOwned(OREO)

consistsofinterestincomereceivedonloansfromcustomersthathasnotyetbeenearnedbythebankunderaccrualaccountingmethods.

Answer:Unearneddiscountincome

canbeheldbyindividualsandnonprofitinstitutions,bearinterestandpermitdraftsfrombeingwrittenagainsttheaccounttopaythirdparties.

Answer:Nowaccounts

Intheworldwidebankingsystem,representtransferabletimedepositsinavarietyofcurrenciesandareoftentheprincipalsourceofshorttermborrowsbybanks.

Answer:EurocurrencyBorrowings

OnepartofarisesfromfeeschargedforATMandPOStransactions.

Answer:OtherNoninterestIncome

Feesthatarisefromafinancialfirm’strustactivities,feesformanagingacorporations’interestanddividendpaymentsandfeesformanagingcorporateorindividualretirementplansareallincludedinthecategoryoffeesarisingfrom.

Answer:fiduciaryactivities

Checkingaccountmaintenancefeesandoverdraftfeesareincludedinthenoninterestincomeaccountunder.

Answer:servicechargesondepositaccounts

True/FalseQuestions

T F 26. Onabank'sincomestatement(ReportofIncome)depositcostsarefinancialinputs.

Answer:True

T F 27. Loansandleasesarefinancialoutputsonafinancialinstitution'sbalancesheetorReportofCondition.

Answer:True

T F 28. Nondepositborrowingsareafinancialinputonabank'sbalancesheetorReportofCondition.

Answer:True

T F 29. Thecostofnondepositborrowingsisafinancialinputonabank'sincomestatementorReportofIncome.

Answer:True

T F 30. Securitiesincomeisafinancialoutputlistedonafinancialinstitution'sReportofCondition.

Answer:False

T F 31. Netloansonabank'sbalancesheetarederivedbydeductingtheallowanceforloanlossesandunearneddiscountsfromgrossloans.

Answer:True

T F 32. Whenaloanisclassifiedasnonperforminganyaccruedinterestrecordedonthebank'sbooks,butnotactuallyreceived,mustbedeductedfromabank'sloanrevenues.

Answer:True

T F 33. InU.S.banking,securitiesgainsaretreatedasordinaryincome.

Answer:True

T F 34. Mostbanksreportsecuritiesgainsasacomponentoftheirtotalnoninterestincome.

Answer:False

T F 35. Abankdisplayingtradingaccountsecuritiesonitsbalancesheetisservingasasecuritydealerandplanstosellthosesecuritiesbeforetheyreachmaturity.

Answer:True

T F 36. Badloansnormallydonotaffectabank'scurrentincome.

Answer:True

T F 37. Theexpensingofaworthlessloanusuallymustoccurintheyearthatloanbecomeworthless.

Answer:True

T F 38. RecoveriesonloanspreviouslychargedoffareaddedtotheProvisionforLoanLosses(PLL)accountonabank'sincomestatement.

Answer:False

T F 39. Loan-lossreservessetasidetocoveraparticularloanorloansexpectedtobeaproblemorpresentthebankwithabove-averageriskareknownasspecificreserves.

Answer:True

T F 40. U.S.banks(especiallythosewith$500millionormoreintotalassets)arerequiredtofilefinancialstatementsauditedbyanindependentpublicaccountantwiththeirprincipalfederalregulatoryagency.

Answer:True

T F 41. Off-balance-sheetitemsforabankarefeegeneratingtransactionswhicharenotrecordedontheirbalancesheet.

Answer:True

T F 42. Theexperiencemethodofaccountingforfutureloanlossreservesallowsabanktodeductfromtheirincomestatementupto.6percentoftheireligibleloans.

Answer:False

T F 43. AftertheTaxReformActof1986,largebanks(>$500millioninassets)wererequiredtousethereservemethodofaccountingforfutureloanlossreserves.

Answer:False

T F 44. Thenumberonesourceofrevenueforabankbasedondollarvolumeisloanincome.

Answer:True

T F 45. Inlookingatcomparativebalancesheets,itcanbeseenthatlargebanksrelymoreheavilyonnondepositborrowingswhilesmallbanksrelymoreheavilyondeposits.

Answer:True

T F 46. ThePensionFundindustryisnowlargerthantheMutualFundindustry.

Answer:False

T F 47. Off-balance-sheetitemsforbankshavedeclinedinrecentyears.

Answer:False

T F 48. Exceptforbanks,Savings&LoansandSavingsBanksholdthemostdeposits.

Answer:True

T F 49. "Paintingthetape"referstothepracticewherebybanksunderstatetheirnonperformingloans.

Answer:False

T F 50. Financialstatementsissuedbybanksandnonblankfinancialservicefirmsarelookingincreasinglysimilartoday.

Answer:True

MultipleChoiceQuestions

Bankassetsfallintoeachofthefollowingcategoriesexcept:

Loans.

Investmentsecurities.

Demanddeposits.

Noninterestcashandduefrombanks.

Otherassets.

Answer:C

Banksgeneratetheirlargestportionofincomefrom:

Loans.

Short-terminvestment.

Demanddeposits.

Long-terminvestments.

Certificatesofdeposit.

Answer:A

Loanstypicallyfallintoeachofthefollowingcategoriesexcept:

Realestate.

Consumer.

CommercialandIndustrial(business).

Agricultural.

Municipal.

Answer:E

Whichofthefollowingadjustmentsaremadetogrossloansandleasestoobtainnetloansandleases?

Theloanandleaselossallowanceissubtractedfromgrossloans

Unearnedincomeissubtractedfromgrossinterestreceived

Investmentincomeisaddedtogrossinterestreceived

AandB.

A.andC.

Answer:D

Anexampleofacontra-assetaccountis:

Theloanandleaselossallowance.

Unearnedincome.

Buildingsandequipment.

Revenuebonds.

Theprovisionforloanloss.

Answer:A

Thenoncashexpenseitemonabank'sReportofIncomedesignedtoshelterabank'scurrentearningsfromtaxesandtohelpprepareforbadloansiscalled:

A) Short-termdebtinterest

B) Noninterestexpense

C) Provisionfortaxes

D) Provisionforpossibleloanlosses

E) Noneoftheabove.

Answer:D

Afinancialinstitution'sbad-debtreserve,asreportedonitsbalancesheet,iscalled:

A) Unearnedincomeordiscount

B) Allowanceforpossibleloanlosses

C) Intangibleassets

D) Customerliabilityonacceptances

E) Noneoftheabove

Answer:B

Whenabankservesasasecuritydealerforcertainkindsofsecurities(mainlyfederal,state,andlocalgovernmentobligations)thevalueofthesesecuritiesisusuallyrecordedinwhataccountonabank'sReportofCondition?

A) InvestmentSecurities

B) TaxableandTax-ExemptSecurities

C) TradingAccountSecurities

D) SecondaryReserves

E) Noneoftheabove

Answer:C

Thedifferencebetweennoninterestincomeandnoninterestexpensesonabank'sReportofIncomeiscalled:

A) NetProfitMargin

B) NetInterestIncome

C) NetIncomeAfterProvisionforPossibleLoanLosses

D) IncomeorLossBeforeIncomeTaxes

E) NetNoninterestIncome

Answer:E

TheaccountthatisbuiltupbyannualnoncashexpensedeductionsandissubtractedfromGrossLoansontheReportofConditionis:

A) Unearnedincome

B) Nonperformingloans

C) Allocatedloanriskdeductions

D) Allowanceforpossibleloanlosses

E) Noneoftheabove.

Answer:D

Nonperformingloansarecreditsonwhichanyscheduledloanrepaymentsandinterestpaymentsarepastdueformorethan:

A) 30days

B) 60days

C) 90days

D) 180days

E) Noneoftheabove.

Answer:C

One-timeonlytransactionsthatofteninvolvefinancialassetsorrealpropertypledgedascollateralbehindaloananduponwhichthebankhasforeclosedaffectabank'saccountknownas:

A) Allowanceforloanlosses

B) Nonrecurringsalesofassets

C) Assetgainsorlosses

D) Provisionforloanandsecuritylosses

E) Noneoftheabove.

Answer:B

Theuseoffixedassets,ratherthanfinancialassets,inordertoincreaseearningsflowingtoabank'sstockholdersisknownas:

A) Plantandequipmentinvestment

B) Financialleverage

C) Operatingleverage

D) Nondepositcapital

E) Noneoftheabove.

Answer:C

Banksdependheavilyuponborrowedfundssuppliedbycustomerswithlittleowners'capitalinvested.Thismeansthatbanksmakeheavyuseof:

A) Financialleverage

B) Capitalrestructuring

C) OperatingLeverage

D) Marginborrowing

E) Noneoftheabove.

Answer:A

Whenaloanisconsidereduncollectible,thebank'saccountingdepartmentwillwrite(charge)itoffthebooksbyreducingthe______andtheaccounts.Whichchoicebelowcorrectlyfillsintheblankintheprecedingsentence?

A) PLLandGrossLoans

B) ALLandNetLoans

C) ALLandGrossLoans

D) PLLandNetLoans

E) Noneoftheabove.

Answer:C

Thecommonbankingpracticeofsellingthoseinvestmentsecuritiesthathaveappreciatedinordertoreapacapitalgainandholdingontothosesecuritieswhosepriceshavedeclinedisknownas:

A) Gainstrading

B) Performancebanking

C) Losscontroltrading

D) Selectiveportfoliomanagement

E) Noneoftheabove.

Answer:A

Noninterestrevenuesourcesforabankarecalled:

A) Commitmentfeesonloans

B) Feeincome

C) Supplementalincome

D) Noninterestmargin

E) Noneoftheabove.

Answer:B

LargeU.S.banksmustusewhichofthemethodslistedbelowtodeterminetheirprovisionforloanlossexpense?

A) Experiencemethod

B) Reservemethod

C) Specificcharge-offmethod

D) Historicalcostmethod

E) Noneoftheabove.

Answer:C

Abank'stemporarylendingofexcessreservestootherbanksislabeledonthebalancesheetas:

A) FedFundsPurchased

B) FedFundsSold

C) MoneyMarketDeposits

D) SecuritiesPurchasedforResale

E) Noneoftheabove

Answer:B

Abanksellssharesofitscommonstockwithaparvalueof$100for$200inthemarket.Whichtwoaccountsonthebank'sbalancesheetaregoingtobeaffected?

A) Retainedearningsandcapitalsurplusaccounts

B) Subordinatednotesanddebenturesandcommonsstockoutstandingaccounts

C) Retainedearningsandcommonstockoutstandingaccounts

D) Commonstockoutstandingandcapitalsurplusaccounts

E) Onlythecommonstockoutstandingaccountisaffected

Answer:D

Atypeofletterofcreditwhichiswidelyusedininternationaltradeisknownas:

A) Banker'sacceptance

B) Commercialpaper

C) Repurchaseagreement

D) Fedfundspurchased

E) Noneoftheabove

Answer:A

AbankwhichstartswithALLof$1.48millionatthebeginningoftheyear,chargesoffworthlessloansof$.94millionduringtheyear,recovers$.12milliononloanspreviouslychargedoffandchargescurrentincomefora$1.02millionprovisionforloanlosseswillhaveanALLattheendoftheyearof:

A) $.66million

B) $3.32million

C) $1.68million

D) $1.28million

E) Thesameamountasatthebeginningoftheyear

Answer:C

Abankthathastotalinterestincomeof$67millionandtotalnoninterestincomeof$14million.Thisbankhastotalinterestexpensesof$35millionandtotalnoninterestexpenses(excludingPLL)of$28million.Itsprovisionforloanlossesis$6millionanditstaxesare$5.Whatisthisbank'snetinterestincome?

A) $7

B) -$14

C) $18

D) $32

E) Noneoftheabove

Answer:D

Abankthathastotalinterestincomeof$67millionandtotalnoninterestincomeof$14million.Thisbankhastotalinterestexpensesof$35millionandtotalnoninterestexpenses(excludingPLL)of$28million.Itsprovisionforloanlossesis$6millionanditstaxesare$5.Whatisthisbank'snetnoninterestincome?

A) $7

B) -$14

C) $18

D) $32

E) Noneoftheabove

Answer:B

Abankthathastotalinterestincomeof$67millionandtotalnoninterestincomeof$14million.Thisbankhastotalinterestexpensesof$35millionandtotalnoninterestexpenses(excludingPLL)of$28million.Itsprovisionforloanlossesis$6millionanditstaxesare$5.Whatisthisbank'snetincome?

A) $7

B) -$14

C) $18

D) $32

E) Noneoftheabove

Answer:A

Whichofthefollowingfinancialstatementsshowstherevenuesandexpenseofabankoverasetperiodoftime?

A) Thestatementofstockholdersequity

B) Thefunds-flowstatement

C) Thereportoffinancialcondition

D) Thereportofincome

E) Noneoftheabove

Answer:D

Whichofthefollowingaccountsissometimescalledthebank'sprimaryreserves?

A) Cashanddepositsduefrombank

B) Investmentsecurities

C) Tradingaccountsecurities

D) Fedfundssold

E) Noneoftheabove

Answer:A

Whichofthefollowingassetsisthelargestassetitemonthebank'sbalancesheet?

A) Securities

B) Cash

C) Loans

D) BankPremises

E) Noneoftheabove

Answer:C

Whatfinancialserviceindustrycategoryissecondtothebankingindustryintotalassetsheld:

A) Mutualfunds

B) Thrifts

C) Investmentbanks

D) Insurancecompanies

E) Pensionfunds

Answer:A

FASBRule115focusesprimarilyonbank:

A) Depositsources

B) Investmentsinmarketablesecurities

C) Derivativestrading

D) Loan-lossreserves

E) Federalfunds

Answer:B

Whichofthefollowingmostaccuratelydescribestheprincipaltype(s)ofbanknoninterestincome:

A) Feesfromfiduciarytransactions

B) Feesfromdeposittransactions

C) Feesfromsecuritiestransactions

D) Feesfromadditionalnoninterestincome

E) Alloftheabove

Answer:E

Feeincomearisingfromfiduciarytransactionsincludeallofthefollowingexcept:

A) Checkingaccountmaintenancefees

B) Feesformanagingandprotectingacustomer’sproperty

C) Feesforrecordkeepingforcorporatesecurity

D) Feesfordispersinginterestanddividendpaymentsforacorporation

E) Feesformanagingcorporateandindividualretirementplans

Answer:A

YouknowthefollowinginformationabouttheMillerStateBank:

GrossLoans $300

MiscellaneousAssets $50

Deposits $390

TotalEquity $50

CommonStockPar $5

Non-DepositBorrowings$60

InvestmentSecurities $150

NetPremises $40

Surplus $5

AllowanceforLoanLosses $50

Deposits $390

TotalAssets $500

GrossPremises $70

Giventhisinformation,whatisthisfirm’sNetLoans?

A)$250

B)$350

C)$500

D)$50

E)$150

Answer:A

YouknowthefollowinginformationabouttheMillerStateBank

GrossLoans $300

MiscellaneousAssets $50

Deposits $390

TotalEquity $50

CommonStockPar $5

Non-DepositBorrowings $60

InvestmentSecurities $150

NetPremises $40

Surplus $5

AllowanceforLoanLosses $50

Deposits $390

TotalAssets $500

GrossPremises $70

Giventhisinformation,whatisthisfirm’sDepreciation?

A)$250

B)$30

C)$70

D)$40

E)$110

Answer:B

YouknowthefollowinginformationabouttheMillerStateBank

GrossLoans $300

MiscellaneousAssets $50

Deposits $390

TotalEquity $50

CommonStockPar $5

Non-DepositBorrowings $60

InvestmentSecurities $150

NetPremises $40

Surplus $5

AllowanceforLoanLosses $50

Deposits $390

TotalAssets $500

GrossPremises $70

Giventhisinformation,whatisthisfirm’sTotalLiabilities?

A)$390

B)$60

C)$450

D)$500

E)$50

Answer:C

YouknowthefollowinginformationabouttheMillerStateBank

GrossLoans $300

MiscellaneousAssets $50

Deposits $390

TotalEquity $50

CommonStockPar $5

Non-DepositBorrowings $60

InvestmentSecurities $150

NetPremises $40

Surplus $5

AllowanceforLoanLosses $50

Deposits $390

TotalAssets $500

GrossPremises $70

Giventhisinformation,whatisthisfirm’sUndividedProfits?

A)$50

B)$5

C)$10

D)$40

E)$450

Answer:D

YouknowthefollowinginformationabouttheMillerStateBank

GrossLoans $300

MiscellaneousAssets $50

Deposits $390

TotalEquity $50

CommonStockPar $5

Non-DepositBorrowings $60

InvestmentSecurities $150

NetPremises $40

Surplus $5

AllowanceforLoanLosses $50

Deposits $390

TotalAssets $500

GrossPremises $70

Giventhisinformation,whatisthisfirm’sTotalLiabilitiesPlusEquity?

A)$250

B)$450

C)$150

D)$50

E)$500

Answer:E

YouknowthefollowinginformationabouttheDavisNationalBank

TotalInterestExpenses ($500)

TotalNonInterestIncome $100

SecuritiesGains(Losses) $50

IncomeTaxes ($80)

DividendstoStockholders ($40)

TotalInterestIncome $800

TotalNonInterestExpenses ($150)

ProvisionforLoanLosses ($100)

Giventhisinformation,whatisthisfirm’sNetInterestIncome?

A)$300

B)$150

C)($50)

D)$120

E)$80

Answer:A

YouknowthefollowinginformationabouttheDavisNationalBank

TotalInterestExpenses ($500)

TotalNonInterestIncome $100

SecuritiesGains(Losses) $50

IncomeTaxes ($80)

DividendstoStockholders ($40)

TotalInterestIncome $800

TotalNonInterestExpenses ($150)

ProvisionforLoanLosses ($100)

Giventhisinformation,whatisthisfirm’sNetNonInterestIncome?

A)$300

B)$150

C)($50)

D)$120

E)$80

Answer:C

YouknowthefollowinginformationabouttheDavisNationalBank

TotalInterestExpenses ($500)

TotalNonInterestIncome $100

SecuritiesGains(Losses) $50

IncomeTaxes ($80)

DividendstoStockholders ($40)

TotalInterestIncome $800

TotalNonInterestExpenses ($150)

ProvisionforLoanLosses ($100)

Giventhisinformation,whatisthisfirm’sPretaxNetOperatingIncome(orNetIncomebeforeExtraordinaryItems)?

A)$300

B)$150

C)($50)

D)$120

E)$80

Answer:B

YouknowthefollowinginformationabouttheDavisNationalBank

TotalInterestExpenses ($500)

TotalNonInterestIncome $100

SecuritiesGains(Losses) $50

IncomeTaxes ($80)

DividendstoStockholders ($40)

TotalInterestIncome $800

TotalNonInterestExpenses ($150)

ProvisionforLoanLosses ($100)

Giventhisinformation,whatisthisfirm’sNetIncome?

A)$300

B)$150

C)($50)

D)$120

E)$80

Answer:D

YouknowthefollowinginformationabouttheDavisNationalBank

TotalInterestExpenses ($500)

TotalNonInterestIncome $100

SecuritiesGains(Losses) $50

IncomeTaxes ($80)

DividendstoStockholders ($40)

TotalInterestIncome $800

TotalNonInterestExpenses ($150)

ProvisionforLoanLosses ($100)

Giventhisinformation,whatisthisfirm’sIncreaseinUndividedProfits?

A)$300

B)$150

C)($50)

D)$120

E)$80

Answer:E

YouknowthefollowinginformationabouttheDavisNationalBank

TotalInterestExpenses ($500)

TotalNonInterestIncome $100

SecuritiesGains(Losses) $50

IncomeTaxes ($80)

DividendstoStockholders ($40)

TotalInterestIncome $800

TotalNonInterestExpenses ($150)

ProvisionforLoanLosses ($100)

Giventhisinformation,whatisthisfirm’sTotalRevenues?

A)$800

B)$850

C)$150

D)$950

Answer:D

YouknowthefollowinginformationabouttheWebbStateBank

AccumulatedDepreciation $40

NetLoans $600

FedFundsPurchasedandRepurchaseAgreements $200

CashandDuefromBanks $50

TradingAccountSecurities $40

MiscellaneousAssets $100

Deposits $500

UndividedProfits $140

GrossPremises $90

Surplus $40

SubordinatedDebt $100

InvestmentSecurities $160

CommonStockPar $20

GrossLoans $700

Giventhisinformation,whatisthisfirm’sAllowanceforLoanLosses?

A)$1300

B)$1000

C)$50

D)$200

E)$100

Answer:E

YouknowthefollowinginformationabouttheWebbStateBank

AccumulatedDepreciation $40

NetLoans $600

FedFundsPurchasedandRepurchaseAgreements $200

CashandDuefromBanks $50

TradingAccountSecurities $40

MiscellaneousAssets $100

Deposits $500

UndividedProfits $140

GrossPremises $90

Surplus $40

SubordinatedDebt $100

InvestmentSecurities $160

CommonStockPar $20

GrossLoans $700

Giventhisinformation,whatisthisfirm’sNetPremises?

A)$130

B)$1000

C)$50

D)$200

E)$100

Answer:C

YouknowthefollowinginformationabouttheWebbStateBank

AccumulatedDepreciation $40

NetLoans $600

FedFundsPurchasedandRepurchaseAgreements $200

CashandDuefromBanks $50

TradingAccountSecurities $40

MiscellaneousAssets $100

Deposits $500

UndividedProfits $140

GrossPremises $90

Surplus $40

SubordinatedDebt $100

InvestmentSecurities $160

CommonStockPar $20

GrossLoans $700

Giventhisinformation,whatisthisfirm’sTotalNonDepositBorrowings?

A)$1000

B)$300

C)$800

D)$200

E)$500

Answer:B

YouknowthefollowinginformationabouttheWebbStateBank

AccumulatedDepreciation $40

NetLoans $600

FedFundsPurchasedandRepurchaseAgreements $200

CashandDuefromBanks $50

TradingAccountSecurities $40

MiscellaneousAssets $100

Deposits $500

UndividedProfits $140

GrossPremises $90

Surplus $40

SubordinatedDebt $100

InvestmentSecurities $160

CommonStockPar $20

GrossLoans $700

Giventhisinformation,whatisthisfirm’sTotalLiabilities?

A)$1000

B)$300

C)$800

D)$200

E)$500

Answer:C

YouknowthefollowinginformationabouttheWebbStateBank

AccumulatedDepreciation $40

NetLoans $600

FedFundsPurchasedandRepurchaseAgreements $200

CashandDuefromBanks $50

TradingAccountSecurities $40

MiscellaneousAssets $100

Deposits $500

UndividedProfits $140

GrossPremises $90

Surplus $40

SubordinatedDebt $100

InvestmentSecurities $160

CommonStockPar $20

GrossLoans $700

Giventhisinformation,whatisthisfirm’sTotalEquity?

A)$1000

B)$300

C)$800

D)$200

E)$500

Answer:D

YouknowthefollowinginformationabouttheWebbStateBank

AccumulatedDepreciation $40

NetLoans $600

FedFundsPurchasedandRepurchaseAgreements $200

CashandDuefromBanks $50

TradingAccountSecurities $40

MiscellaneousAssets $100

Deposits $500

UndividedProfits $140

GrossPremises