A Bank Has Currency and Coins Equal to $20 Million

question 23

Multiple Choice

A bank has currency and coins equal to $20 million in its vaults.It has securities worth $10 million, has borrowings equal to $5 million, and has given out loans equal to $2 million.It also has deposits with the Federal Reserve equal to $4 million.The total reserves of the bank equals

• A)$12 million.
• B)$22 million.
• C)$24 million.
• D)$36 million.

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Definitions:

Accrual Basis

An accounting method where revenue and expenses are recorded when they are earned or incurred, regardless of when the cash is actually received or paid.

Conceptual Identity

This key term is not a standard accounting or financial concept. NO.

Income Statement

A financial statement that reports a company's financial performance over a specific accounting period, detailing revenues, expenses, and profits or losses.

Stewardship Function

Refers to the responsibility of management to manage and protect the assets of a company on behalf of its owners and stakeholders.