ACCT 405 : Accounting of Financial Institutions
etrade2016
2-SecondAssignment_ACCT405_Questions.docxDepartment of Accounting
|
Course Title |
Accounting of Financial Institutions |
Assignment No. |
Second |
|
Course Code |
ACCT 405 |
Due Date |
October 26, 2017 (11:59 PM) |
Maximum Marks: 10
Attempt All the Questions:
1. Prepare a Statement of Financial Position of Jeddah Financial Corporation from the following details:
|
Cash |
518,161 |
|
Federal Funds Sold and other investments |
1,321,626 |
|
Advanced from Federal Home Loans |
38,961,165 |
|
Securities Available for sale, at fair value |
382,499 |
|
Securities sold under agreements to repurchase |
5,000,000 |
|
Senior Debts |
8,194,266 |
|
Loans held for sale |
83,365 |
|
Mortgage backed securities with recourse held to maturity, at cost |
1,168,480 |
|
Interest earned but uncollected |
392,303 |
|
Premises and Equipment, net |
403,084 |
|
Other Assets |
? |
|
Loans Held for Investment |
117,798,600 |
|
Common Stock |
30,804 |
|
Additional Paid in Capital |
338,997 |
|
Retained Earnings |
81,408,185 |
2. Dammam West Bank has an obligation to pay a fixed nominal amount of $ 150, 8 years from today. Assume that the appropriate annual interest rate for this instrument, denoted r, is currently 10%. Answer the following questions:
a) What is the current value of obligation
b) What will the value of obligating if the rate of interest is increased by 4%
c) What will be value of obligation if the rate of interest is decreased by 2%
3. For a bank to accept credit risk, it must expect to be paid either interest at a sufficiently large premium above the risk-free rate or an actuarially fair fee. Considering this fact, how will you determine credit risk premium.
