What Is the Asset Adjustment to a Bank's Balance Sheet

question 25

Multiple Choice

What is the asset adjustment to a bank's balance sheet if the bank sold a five-year, 7 percent annual coupon $100,000 bond acquired at par, but now yielding 8 percent? The bond was not in the mark-to-market portfolio.

• A)A $96,007 reduction in assets.
• B)A $96,007 increase in assets.
• C)A $100,000 reduction in assets.
• D)A $100,000 increase in assets.
• E)A $100,000 increase in liabilities.

Identify the purposes and impacts of both operating and capital expenditure budgets on financial planning.

Understand the principles and practices of effective budget preparation and control.

Recognize the effects of various budgeting approaches on cost management and performance evaluation.

Understand the significance of participatory processes in developing more effective and accurate budgets.

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Definitions:

Correlation

A measure of the relationship between two variables or sets of data.

Dependent Variable

The variable in an experiment that is expected to change in response to changes in the independent variable.

Colder Temperatures

Lower-than-average temperatures that can influence climate patterns, weather conditions, and the living conditions of organisms.

Snowfall

The occurrence of snow descending from clouds to the ground, which is a key component of the hydrological cycle and can significantly impact the environment and human activities.