The Following Information Details the Current Rate Sensitivity Report for Gotbucks

question 10

Multiple Choice

The following information details the current rate sensitivity report for Gotbucks Bank, Inc. ($million) .
-How will a decrease of 25 basis points in all interest rates affect Gotbuck's net interest income over a planning period of 91 days?

• A)+$0.1875 million.
• B)+$0.1250 million.
• C)-$0.1375 million.
• D)+$0.0625 million.

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Definitions:

Overhead Volume Variance

A measure used in management accounting to analyze the difference between budgeted and actual overhead costs, attributable to variations in the level of production or operation.

Fixed Overhead Costs

Refer to the recurring, static expenses associated with operating a business that do not fluctuate with production levels or sales volumes.

Overhead Controllable Variance

The difference between the actual overhead costs incurred and the expected (standard) overhead costs that should have been incurred, given the level of output.

Actual Overhead Costs

The real expenses that a company incurs for running its operations, excluding direct labor and materials, instead involving costs like utilities and rent.