Banks generate their largeset portion of income from:
Loans
Do loans fall into a category of Munis?
No
What kind of account is the Reserve for loand lease losses?
Contra-Asset Account
A financial institution's bad-debt reserve as reported on its balance sheet is called:
The Reserve for Loan and Lease Losses
Noncash expense item on a bank's Report of Income designed to shelter a bank's current earnings from taxes and to help prepare for bad loans is called:
Provision for possible loan losses
When a bank serves as a security dealer for certain kinds of securities the value of these are usually recorded in what account on a bank's report of condition?
Trading Account Securities
What is the difference between noninterest income and noninterest expenses on a bank's report of income called:
net noninterest income
The account that is built up by annual noncash expense deductions and is subtracted from Gross Loans on the Report of Condition is:
Reserve for Loan and Lease Losses
One time only transactions that often involve financial assets or real property pledged as collateral behind a loan and upon which the bank has foreclosed affect a bank's account known as:
Nonrecurring sales of assets
The use of fixed assets, rather than financial, in order to increase earnings flowing to a bank's stockholders is known as:
Operating Leverage
Banks depend heavily upon borrowed funds supplied by customers with little owners' capital invested. This means that banks make heavy use of:
Financial Leverage
When a loan is considered uncollectible, the bank's accounting department will write it off the books by reducing which accounts?
ALL & Gross Loans
Common banking practice of selling those investment securities that have appreciated in order to reap a capital gain and holding onto those securities whose prices have declined is known as:
Gains Trading
Noninterest revenue sources for a bank are called:
Fee Income
Which asset is the largest on a bank's balance sheet?
Loans
What financial service industry category is second to the banking industry in total assets held?
Mutual Funds
Which financial statement shows the revenues and expense of a bank over a set period of time?