Compensating balancesa. are a particular form of collateral commonly required on commercial loans.
b. allow banks to monitor firms' check payment practices, which can yield information about their borrowers' financial conditions.
c. are a required minimum amount of funds that a borrower (i.e., a firm receiving a loan) must keep in a checking account at the bank.
d. are all of the above.

Answers

Answer 1

Answer:

Answer:

The correct answer is D

Explanation:

Compensating balance is the balance which is to be minimum amount that is to maintained or kept in the bank account, so that could be used to offset the cost incurred by the bank for setting up the loan.

It is that balance which is not available for the company to use and might be needed to disclose in the notes of the borrower in the financial statements.

So, it is a specific kind of collateral, allow bank to monitor payment practice of firms and require to have a minimum amount that borrower need to keep in the checking account.

Related Questions

Debt is _____. cash borrowed from a credit card account a bonus from the credit card company for being a good customer an amount of money that is owed to a bank, credit card company, store, or another individual a loan used to pay for a house, car, or another large item
ou have just received seed money for a new e-commerce business and you want to hire a dozen people with a lot of creative potential. To hire the most creative people, you would select applicants who: select one:a. Have no experience in this industry, have high analytic intelligence, and have a relatively low need for achievement.b. Has above-average intelligence, is persistent, has subject-matter expertise, and an inventive thinking style.
Which of these describes the fundamental conflict of economics? a. the need for government control and the desire for an unregulated market b. the management of limited resources to satisfy unlimited wants c. the competition of different sellers in the marketplace d. the balance of supply and demand Please select the best answer from the choices provided A B C D
Of the following sets of accounting entries, which one correctly records the purchase of a piece of equipment? A : a $15,000 increase in cash and a $15,000 decrease in equipment, both entered on the same date B : a $5,000 decrease in cash, a $15,000 increase in notes payable, and a $20,000 increase in equipment, all entered on the same date C : a $14,000 decrease in cash, a $4,000 increase in notes payable, and a $10,000 increase in equipment, all entered on the same date D : a $16,000 decrease in notes payable and a $16,000 increase in equipment, both entered on the same date
Banks _____ the money supply because they _____ currency from circulation and place it in their vaults or deposit it at the Federal Reserve.

Which are the requirements that must be met for a special revenue fund to be classified as a major fund? Select one: a. Total assets, liabilities, revenues, or expenditures of the individual governmental fund must be at least 10 percent of the total governmental funds category. b. The fund must have qualified to be classified as a major fund for at least three of the past five years if it has been in existence for that length of time. c. Total assets, liabilities, revenues, or expenditures of the individual governmental or enterprise fund are 5 percent of the total of the governmental funds and enterprise categories combined. d. All of the above e. Both A and C are necessary.

Answers

Answer:

The answer is "e. Both A and C are necessary"

Explanation:

First of all, we need to define what a Special Revenue Fund is. This is a fund that a government creates with the purpose of collecting funds that are to be used for a specific project. This also helps in ensuring accountability as well as this indicates that the tax payer's money is being utilized appropriately.

Note that this does not pertain to funds established by private sector entities but are 'governmental in nature'.

Now, a primary requirement for a governmental fund to be classified as a 'major' fund is if at least one element of the fund (that can be either revenue, expenditure, liabilities or assets) are equivalent to a minimum of 10% of the corresponding elements of total government funds. In the given example, 10% of the revenue in the Special Revenue Fund is equivalent to at least 10% of the revenue of the total governmental funds. This figure needs to equivalent to 5% of total governmental and enterprise funds combined as well. Once these two conditions are met, we can classify the Special Revenue Fund as a major fund.

Keeping in mind the above requirement, options 'a' and 'c' BOTH are correct. Also note, that there is no timeframe required for a fund to be classified as major therefore option 'b' is ruled out.

Money that your company has in the bank in case of unexpected financial needs or in case sales slow down is called ____________.a. An asset fund
b. A cash reserve
c. Equity
d. Insurance

Answers

The answer is B - cash reserve

Layoffs are predictable. true or false

Answers

That statement is True.

If you see the company's financial performances, you can easily predict whether a company would expand or cut off their employees. Poor financial performance always directly connected to emloyees' layoff

The correct answer is false.

Describe how you would use any five entrepreneurial qualities to make sure that your business is a success

Answers

Passion
being open minded
desire to become the best at what you do
having a positive attitude and outlook
constantly keep your ideas flowing

Citrus inc., a leading internet service provider, provides its top managers with a bonus every year. however, this year the company performed poorly and its average stock price dropped below the industry standards. the company decided not to reward the managers this time around. this scenario typically illustrates the reinforcement contingency of _____. a) positive reinforcement
b) extinction punishment
c) negative reinforcement

Answers

Answer: The correct answer is "b) extinction punishment".

Explanation: This scenario typically illustrates the reinforcement contingency ofextinction punishment.

Because the company in deciding not to reward managers this time, is extinguishing the benefit they had, in the form of punishment for the poor performance of the company.

Stereotyping in the workforce has led tostronger career options for everyone
pay discrepancies
equal pay
men being unable to get work

Answers

pay discrepancies i believe

Other Questions

The Waltham System a. employed whole families to work in textile mills. b. employed young women in their late teens and early twenties. c. employed young children, who often worked 10-12 hours per day. d. was considered a disreputable form of employment for women.

Which of these represents an equilibrium price for designer jeans? The arrow pointing to D2 The intersection of P1 and Q1 The line marked D1 The line marked S

On December 1, Bright Company receives a 6% interest-bearing note from Galvalume Company to settle a $20,000 account receivable. The note is due in three months. At December 31, Bright should record interest revenue ofa. $100.b. $600.c. $0.d. $200.

2. Management is essential for the organisations which are(a) Non-profit organisations(b) Service organisations(c) Social organisations(d) All of the above