Table 10-3 The Following Information Pertains to the Bank of Kamloops

question 142

Multiple Choice

Table 10-3
The following information pertains to the Bank of Kamloops.
-Refer to the Table 10-3.If the Bank of Kamloops has loaned out all the money it wants,given its deposits,what is its reserve ratio?

• A) 1 percent
• B) 5 percent
• C) 10 percent
• D) 15 percent

---

Definitions:

Depreciate

The reduction in the value of an asset over time, often due to wear and tear or obsolescence.

Lease Term

The fixed, non-cancellable period during which a lessee has the right to use an asset, plus any options to extend or terminate the lease if reasonably certain to be exercised.

Lease Criteria

The conditions and standards that a contract must meet for it to be classified as a lease under accounting standards.

Incremental Borrowing Rate

The interest rate a lessee would have to pay to borrow on a collateralized basis over a similar term to lease a similar asset, relevant in lease accounting.