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exis [7]
3 years ago
10

The Tidewater State Bank has $1000 in total assets (all of which are earning assets), $700 of which will be replaced with in the

next 90 days. This bank also has $800 in total liabilities, $400 of which will be replaced within the next 90 days. Currently, the bank is earning 8% on its assets and is paying 5% on its liabilities. If interest rates do not change in the next ninety days, what is this bank's net interest margin?
Business
1 answer:
Nesterboy [21]3 years ago
5 0

Answer:

4.6%

Explanation:

The computation is shown below:

= (Interest on assets - Interest on liabilities) ÷ (Total earning assets)

where,

Interest on assets = (8% + 2% × $700) + 8% × $300

= $70 + $24

= $94

Now the interest on liabilities equal to

= 5% × 400 + (5% + 2% × 400)

= $20 + $28

= $48

So, the net interest margin equal to

= ($94 - $48) ÷ ($1,000)

= 4.6%

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Answer:

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Explanation:

(A). On FEB. 1, the accounts and Explanation is given below:

Cash ( debit) = 2,444,000 {that is from; 47,000 × $52}.

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(B). On JULY 1, the accounts and Explanation is given below;

"July 1 Issued 62,500 shares for cash at $56 per share."

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7 0
2 years ago
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Answer:

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$0

+$183,000

Explanation:

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Total liabilities has no change

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Answer:

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