Accounting and Finance Questions

Fractional reserve banking is the practice whereby a bank accepts deposits, makes loans or investments, but is required to hold reserves equal to only a fraction of its deposit liabilities. Fractional reserve banking is a banking system in which only a fraction of bank deposits are backed by actual cash on hand and are available for withdrawal. This is done to expand the economy by freeing up capital that can be loaned out to other parties.

Most financial investments are examples of Human risk type of risks. Since, we humans invest in any kind of financial investments on our own risk expecting profits.

Payroll is defined as its a remuneration given for work done by individuals on daily,monthly,weekly etc....

The words "asset" and "liability" are two very common words in accounting. Liabilities are legally binding obligations that are payable to another person or entity. Accounts payable, loans, mortgages, deferred revenue,... come under liabilities.

APR means Annual Percentage Rate. Creditcards apr can be increased when you missed credit card payments.

Accounts receivable is listed as a current asset in the balance sheet, since it is usually convertible into cash in less than one year as it is the amount owed by the customer to the seller.