If a Bank Has Assets of $5 Billion and Liabilities

question 170

Multiple Choice

If a bank has assets of $5 billion and liabilities of $4.8 billion

• A) its equity equals $.2 billion.
• B) its equity equals -$.8 billion.
• C) it faces a solvency crisis.
• D) its equity equals -$.8 million and it faces a solvency crisis.

---

Definitions:

Accounting

The systematic process of recording, measuring, and communicating information about financial transactions.