In This Type of Arrangement,any Balances Above a Certain Amount

question 9

Multiple Choice

In this type of arrangement,any balances above a certain amount in a corporation's checking account at the end of the business day are "removed" and invested in overnight securities that pay the corporation interest. This innovation is referred to as a

• A)sweep account.
• B)share draft account.
• C)removed-repo account.
• D)stockman account.

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Definitions:

Unemployment Taxes

Taxes paid by employers to fund unemployment insurance programs, varying by state and based on the amount of wages paid to employees.

Federal Income Taxes

Taxes levied by the federal government on the annual earnings of individuals, corporations, trusts, and other legal entities.

Withholding Allowances

Amounts exempted from an employee's income tax withholding, directly related to the number of dependents and personal situations.

Current Earnings

The net income that a company has generated over a specific period, excluding any non-operational or extraordinary items.