Standard Chartered Bank, one of the largest financial institutions in the United Kingdom with total assets of £550 billion, showed the following items (among others) on its balance sheet at January 1, 2020 (in millions):

1. Suppose Delta Company, a small retailer from Bristol, deposited £10,000 in the bank. How would Delta’s deposit affect each of the bank’s assets, liabilities, and stockholders’ equities? How much would the deposit affect Delta’s assets, liabilities and owners’ equities? Be specific. 

2. Suppose Delta Company borrowed £20,000 from Standard Chartered Bank. How would such a transaction affect Delta’s assets, liabilities and owners’ equities? Be specific. 

3. Suppose Standard Chartered Bank makes a £450,000 loan to The Queens Park Hotel for remodeling purposes. How would this loan affect each of the bank’s assets, liabilities, and stockholders’ equities? Be specific.

Transcribed Image Text:

Cash (an asset) Total deposits (a liability) £ 65,105 £1,426,504