COST ACCOUNTING
TRANSFER PRICING
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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Branch which may turn into profit making after claim subsidy
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All Branch
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ARMP Branch
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Specialised Branch
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Detailed explanation-1: -The NPAs have a deteriorating effect on the banking system. This reduces a bank or financial institution’s capital adequacy. The banks have become averse to giving loans and taking risks of zero percent. Thus, the creation of fresh credit is debarred.
Detailed explanation-2: -There are various avenues for recovery of Non Performing Asset (NPA), they are Insolvency and Bankruptcy Code, the SARFAESI Act, Asset Reconstruction, Debt Recovery Tribunals, Lok Adalats.
Detailed explanation-3: -Provision for Non Performing Assets means the banks keep aside a certain amount from their profits in a particular quarter for NPAs. This is because this asset can turn into losses in the future. Thus, by this method, banks can maintain a healthy book of accounts by provisioning for bad assets.