A Bank Has $50,000 in Deposits from Its Checking Account

question 160

Multiple Choice

A bank has $50,000 in deposits from its checking account customers and loans of $49,000. Of the $49,000 loaned out, $43,000 had remained in the checking accounts of the loan recipients but now has been withdrawn as cash by the loan recipients. The bank had $50,000 cash on hand prior to the remaining loan proceeds being converted to cash, and the reserve requirement is 25%. The reserve ratio for this bank after the remaining loan proceeds are converted to cash is _____, and it _____ meeting its reserve requirement.

• A) 0.002%; is not
• B) 14%; is not
• C) 20%; is
• D) 53.76%; is

Understand the concept and implications of early supplier involvement (ESI) in procurement.

Identify strategies for managing undesirable buyer-supplier relationship scenarios.

Understand the evolution and current trends in supply management.

Recognize the importance of monitoring market trends and technologies in supply chain management.

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Definitions:

Contra Asset

An account on a company's balance sheet that offsets or reduces the balance of a related account.

Prepaid Expense

Expenses paid in advance for goods or services to be received in the future, treated as assets until they are actually consumed or expired.

Accounts Receivable

Receivables from clients to a corporation for products delivered or services rendered without payment.

Unearned Subscription Revenue

Unearned subscription revenue represents money received by a company for subscriptions or services not yet provided or delivered, recognized as a liability until the service is fulfilled.