Under lagged reserve requirement accounting all of the following are true EXCEPT:
A) the transactions computation period comes before the maintenance period
B) there is a 17-day lag between the end of the transactions computational period and the beginning of the maintenance period
C) the vault cash computational period is 14 days long
D) LRR rules apply only to nontransactions accounts

Question

Quizplus · Accepted Answer

Lagged Reserve Requirement (LRR) rules apply to transactions accounts, not just nontransactions accounts. The purpose of LRR is to determine the amount of reserves a bank must hold against its transaction accounts, where the reserve requirement is based on the bank's deposits during a previous period.

Under Lagged Reserve Requirement Accounting All of the Following Are