Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

I dontknow how to do it? it is due on tomorrow. Thank 1. Using T-accounts (template below), to summarize the following transactions (6 points) a.

image text in transcribed

I dontknow how to do it?

it is due on tomorrow. Thank

image text in transcribed 1. Using T-accounts (template below), to summarize the following transactions (6 points) a. Snow opened a checkable account at BANK ABC with $100 cash. Let's assume that BANK ABC put all the vault cash from this transaction as part of the bank's reserves. How should the T account looks like in this case? Assets Cash $1000 BANK ABC Liabilities Checkable Deposits $1000 b. Let's assume the reserve ratio is 8% for BANK ABC. After the above transaction, BANK ABC only keep the required reserves, while use another 20% as excess reserve, the rest of the money to make loans. How should the T account looks like in this case? Assets BANK ABC Liabilities c. One month after transaction b above, Snow decide to withdraw half of her deposit. Does the bank have enough reserve for the withdraw? How should the T account looks like after the withdrawal of money? Assets BANK ABC Liabilities 1 2. If a bank has $200,000 of deposits, a required reserve ratio of 20 percent, and $80,000 in reserves, then the maximum deposit outflow it can sustain without altering its balance sheet is. Please show your steps ( 5 points) 3. When a $10 check written on the First national Bank is deposited in an account at the Second National Bank, how the transaction affects both banks' balance sheet (5 points) First National Bank Second National Bank Asset Liabilities Assets Liabilities 2

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

The Company Valuation Playbook Invest With Confidence

Authors: Charles Sunnucks

1st Edition

1838470816, 978-1838470814

Students also viewed these Finance questions