All steps of calculation required for reference. Thanks Consider the following Balance Sheet related data for Kairful Finance Corp. (KFC), a Canadian schedule B bank.AmountAmount(millions)LiabilitiesCustomer chequing a/c'sGIC'sLong term FinancingTotal LiabilitiesShareholders EquityTotal Liabilities and EquityAssetsCashDuration(millions)Duration80.000.0120.000.0Short term loansMortgages228.001.5147.501.0152.006.5147.509.0415.00Total Assets460.0045.00460.00Required (3 parts):1.What is the duration of KFC's assets? Liabilities? And equity?Ifinterest rates are currently 2% but increase to 4%, how much will KFC's equity change by (approximately)? Usethe duration calculations to come up with your answer.2.KFC is considering managing its interest rate risk and achieving a duration neutral position. Assume it has the3.ability to buy or sell 10 year zero coupon bonds. What dollar value of these bonds should it buy or sell to achieveits desired duration neutral position?

Duration of Equity, also known as Equity Duration, is a financial metric used to measure the…

Consider the following Balance Sheet related data for Kairful Finance Corp. (KFC), a Canadian schedule B bank. Amount (millions) 1. Assets Cash Short term loans Mortgages Required (3 parts): Total Assets 3. $ 80.00 228.00 152.00 $ 460.00 Duration 0.0 1.5 6.5 What is the duration of KFC's assets? Liabilities? And equity? Liabilities Customer chequing a/c's GIC'S Long term Financing Total Liabilities Amount (millions) $ Shareholders Equity Total Liabilities and Equity $ 120.00 147.50 147.50 415.00 45.00 460.00 2. If interest rates are currently 2% but increase to 4%, how much will KFC's equity change by (approximately)? Use the duration calculations to come up with your answer. KFC is considering managing its interest rate risk and achieving a duration neutral position. Assume it has the ability to buy or sell 10 year zero coupon bonds. What dollar value of these bonds should it buy or sell to achieve its desired duration neutral position? Duration 0.0 1.0 9.0

Consider the following Balance Sheet related data for Kairful Finance Corp. (KFC), a Canadian schedule B bank. Amount (millions) 1. Assets Cash Short term loans Mortgages Required (3 parts): Total Assets 3. $ 80.00 228.00 152.00 $ 460.00 Duration 0.0 1.5 6.5 What is the duration of KFC's assets? Liabilities? And equity? Liabilities Customer chequing a/c's GIC'S Long term Financing Total Liabilities Amount (millions) $ Shareholders Equity Total Liabilities and Equity $ 120.00 147.50 147.50 415.00 45.00 460.00 2. If interest rates are currently 2% but increase to 4%, how much will KFC's equity change by (approximately)? Use the duration calculations to come up with your answer. KFC is considering managing its interest rate risk and achieving a duration neutral position. Assume it has the ability to buy or sell 10 year zero coupon bonds. What dollar value of these bonds should it buy or sell to achieve its desired duration neutral position? Duration 0.0 1.0 9.0

Intermediate Accounting: Reporting And Analysis

3rd Edition

ISBN:9781337788281

Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Chapter4: The Balance Sheet And The Statement Of Shareholders' Equity

Section: Chapter Questions

Problem 16P: Ratios Analyses: McCormick Refer to the information for McCormick above. Additional information for...

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