A Bank in Poor Condition May Take Out a Loan

question 13

Multiple Choice

A bank in poor condition may take out a loan under close Fed scrutiny.Such a loan is known as

• A)a secondary credit discount loan.
• B)a haircut.
• C)a covenant.
• D)a primary credit discount loan.

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Definitions:

Financial Statement

Reports outlining the financial standing of a business, incorporating the balance sheet, income statement, and cash flow statement.

Permanent/Temporary

Classification of accounts where permanent accounts (real accounts) represent ongoing items that are not closed at the end of the accounting period, whereas temporary accounts (nominal accounts) are closed.

Trial Balance

A bookkeeping worksheet in which the balances of all ledgers are compiled into debit and credit account column totals that are equal, ensuring accuracy of the figures.