Under the Purchase-And-Assumption Method, the FDIC Usually Finds It

question 115

Multiple Choice

Under the purchase-and-assumption method, the FDIC usually finds it:

• A)Can sell the failed bank for more than the bank is actually worth
• B)Can sell the bank at a price equaling the value of the failed banks assets
• C)Has to sell the bank at a negative price since the bank is insolvent
• D)Cannot sell the bank and almost always has to revert to the payoff method for dealing with a failed bank

Recognize the importance and method of initial investment recording at cost.

Discern the impact of unrealized holding gains and losses on net income and equity, depending on the category of the investment.

Grasp the rules for consolidation, including the percentage of ownership that generally signifies control.

Distinguish between equity securities that do and do not qualify as investments in securities (e.g., common stocks, preferred stocks, convertible bonds, stock options).