Chapter 19, Problem 4BIC

Please contemplate the following scenarios and answer accordingly.a. Islamic banking has entered into Murabaha transaction with Mr. Daghabaaz. Mr. Daghabaaz defaulted on payments of installment later and IB charged accordingly provision as per the aging of receivable. However, Mr. Daghabaaz contacted bank to request a rollover on said transaction to avoid blacklisting.Requirement:         As an Islamic Banker, do you think IB can charge any penalty for late payment to Daghabaaz and grant rollover facility.

Explain why some financial institutions prefer to provide credit in financial markets outside their own country

A Letter of Credit (LC) is a document that guarantees the buyer's payment to the sellers. It is issued by a bank and ensures timely and full payment to the seller. If the buyer is unable to make such a payment, the bank covers the full or the remaining amount on behalf of the buyer. Why would the bank pay the remaining amount on behalf of the buyer, and what would be the risk exposed to the bank? Please explain thoroughly.

1. Why don’t the additions and deductions from the bank balance on a bank reconciliation require adjustment by the company? 2. Do all transactions by U.S. companies with foreign parties require special accounting procedures by the U.S. companies? Explain.

Which of the following is not a way in which banks lend short-term unsecured loans? a. Through a guaranteed credit line that has a commitment fee for any unused amount for the year b. Through credits cards lines with a certain credit limit c. By sending the amount earned from trust and investment products offered by the bank d. By lending a single date maturity loan to a debtor

Researching GAAP Situation Hamilton Company operates in an industry with numerous competitors. It is experiencing a shortage of cash and decides to obtain money from a large bank by using some of its receivables as collateral. Hamilton pledges 5100,000 of its receivables, is charged a 12% fee on this amount, and notifies these credit customers to make their payments directly to the bank. Hamilton transfers the receivables to the bank, and the bank assumes the servicing activities, but Hamilton is responsible for all bad debts which it reasonably estimates to be 2% of the receivables amount. When the balance of the receivables pledged is reduced to 3,000, Hamilton is required to repurchase the receivables, notify the remaining credit customers to make payments to it, and reassume the servicing activities. The bank has the right to sell the receivables, except to Hamiltons major competitor. Hamiltons president has asked you how to account for (and record) this transaction. Directions Research the related generally accepted accounting principles and prepare a short memo to the president that answers his question. Cite your reference and applicable paragraph numbers.

Private mortgage insurance is used to a. to ensure timely payments of escrow, taxes, and other fixed charges. b. reduce the default risk to lenders c. protect borrowers if they cannot make periodic payments d. in lieu of a bond for termites   Covenants in loan agreements are used to a. make representations in agreements b. secure collateral c. control the borrower’s behaviour d. as guaranties   The Barbados branch of a foreign bank has a ROE that is three times greater than the TT branch. What may be the reason for this difference? a. The Barbados branch has lower equity b. The Barbados branch is more profitable than the TT branch c. The Barbados branch has proportionately higher profits to equity d. The TT branch has higher equity   Assume a single-payment $1,000 loan for one year at 16 percent. The APR is a. 24 percent b. 16 percent c. none of the above d. 32 percent

Does India have the Shadow-banking system? Explain in your own words, no plagiarism.