Question
3. Smallville Bank has the following balance sheet, rates earned on their assets, and rates paid on their liabilities. Balance Sheet (in thousands) Assets Rate
| 3. Smallville Bank has the following balance sheet, rates earned on their assets, and rates paid on their liabilities. | ||||||
| Balance Sheet (in thousands) | ||||||
| Assets | Rate Earned (%) | Liabilities and Equity | Rate Paid (%) | |||
| Cash | 7,000 | 0 | Demand deposits | 10,000 | 0 | |
| Investment securities | 10,000 | 4 | NOW accounts | 55,000 | 2 | |
| Repurchase aggrements | 12,000 | 2 | Retail CDs | 20,000 | 3 | |
| Loans less allowance for losses | 90,000 | 5 | Subordinated debentured | 11,000 | 5 | |
| Fixed assets | 10,000 | 0 | Total liabilities | 96,000 | ||
| Other assets | 1,000 | 3 | Common stock | 10,000 | ||
| Total assets | 130,000 | Paid-in capital surplus Retained earnings | 13,000 11,000 | |||
| Total liabilities and equity | 130,000 | |||||
| The bank earns $100,000 in noninterest income, incurs $70,000 in noninterest expenses, and pays $1,400,000 in taxes. | ||||||
| Current period's allocation to the allowance for losses is $600,000. Please construct Smallville Bank's income statement. | ||||||
| Income Statement (in thousands) | |
| Interest income |
|
| Interest expense |
|
| Net interest income |
|
| Provision for loan losses |
|
| Noninterest income |
|
| Noninterest expense |
|
| Income before Taxes and Extraordinary Items | |
| Income Taxes |
|
| Net Income | |
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Fundamentals of Database Systems
Authors: Ramez Elmasri, Shamkant Navathe
6th edition
136086209, 978-0136086208
