Bank guarantees, Managerial Accounting

Assignment Help:

Bank guarantee is one of the facilities which the commercial banks extend in support of their clients in favour of third parties who will be the beneficiaries of the guarantees. In fact, while a bank guarantee is specified, no credit is extended and banks do not part along with any funds. There will be only a guarantee to the beneficiary to create payment in the event of the customer on whose behalf the guarantee is provided, defaults on his commitment. Thus if the customer fails to pay according the terms of the guarantee, the banker providing the guarantee has to pay and claim reimbursement from his client. The banker's liability occurs only if these customers are unsuccessful to pay the beneficiary of the guarantee. That's why bank guarantee limits are termed as not fund limits or non-borrowings limits.


Related Discussions:- Bank guarantees

What are the objectives of budgetary control, What are the Objectives of bu...

What are the Objectives of budgetary control 1) Planning : planning is an important managerial function. it helps to decide in advance, what to do how to do it when to do it a

Advantages-disadvantages-standard costing, The advantages and disadvantages...

The advantages and disadvantages of standard costing The benefits for controlling having a standard costing system in operation can be summed up as follows; Cautiously pl

What is master budget, What is Master budget Financial budget are conce...

What is Master budget Financial budget are concerned with cash receipts and disbursements working capital. Several functional budgets are integrated into master budget. This bu

State the penetration pricing, State the Penetration pricing As opposed...

State the Penetration pricing As opposed to the skimming pricing the objective of penetration pricing is to gain a foothold in a highly competitive market. The objective of thi

Sales of cool-man air conditioners, Sales of Cool-Man air conditioners have...

Sales of Cool-Man air conditioners have increase steadily during the past five years: Year    Sales 1        450 2        495 3        518 4        563 5        584 6          ?

Transportation problem-solution, Transportation Problem-Solution Soluti...

Transportation Problem-Solution Solution of the Transportation Problem: The fundamental steps of the transportation method are: Step 1:       Determine a preliminary b

Illustrate the marginal cost pricing, Marginal cost or incremental cost pri...

Marginal cost or incremental cost pricing method: Here the company may work on the premise of recovering its marginal cost and getting a contribution towards its overheads. Thi

Break even analysis, BREAK EVEN ANALYSIS Break even analysis is mainly us...

BREAK EVEN ANALYSIS Break even analysis is mainly used to explain the relationship between the cost incurred, the volume operated at and the profit earned. To compute the breakev

Prepare an approximation of working capital requirements, On 1st January, 2...

On 1st January, 2005 the Board of Directors of Paushak Limited needed to identify the amount of working capital needed to meet the programme they have arranged for the year. From t

Identify which of the entities listed should record, Frontier Sports sells ...

Frontier Sports sells hunting and fishing equipment and provides guided hunting and fishing trips. Frontier Sports is owned and operated by Wally Schnee, a well-known sports enthus

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd