3.
Which of the following is not type of NPA (Non-
performing assets)
(a) Sub-standard assets
(b) Doubtful assets
s Current assets
(d) Loss assets
Answers
Answer:
doubtful assets are not type of NPA
NON PERFORMING ASSETS
Current assets is not a type of non performing assets.
GETTING TO KNOW MORE ABOUT NON PERFORMING ASSETS:
* A nonperforming asset (NPA) is a financial instrument in which the borrower has failed to make any agreed-upon interest or principal repayments to the designated lender for a prolonged period of time. As a result, the lender receives no revenue in the form of interest payments from the nonperforming asset.
* Carrying nonperforming assets on the balance sheet, often known as nonperforming loans, imposes three separate constraints on lenders. Nonpayment of interest or principal affects the lender's cash flow, disrupting budgeting and lowering profitability.
* The capital available to issue further loans is reduced by loan loss provisions, which are set aside to cover possible losses. Once the real losses from defaulted loans have been calculated, they are deducted from earnings.