Retail Savings Accounts Are Considered as Part of Rate Sensitive

question 83

True/False

Retail savings accounts are considered as part of rate sensitive liabilities because the rates on these accounts rarely change.

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Definitions:

Direct Method

The Direct Method in accounting refers to a way of reporting cash flows from operating activities by directly listing major classes of gross cash receipts and payments.

Operating Activities

The primary revenue-generating activities of a business which include production, sales, and delivery of the company’s main goods and services.

Accrual Basis

An accounting method where transactions are recorded when they are earned or incurred, regardless of when cash is exchanged, offering a more accurate financial picture.

Cash Basis

An accounting method where revenues and expenses are recorded when they are actually received or paid, not when they are incurred.