Examples of off-balance-sheet activities include
A)trading activities.
B)extending loans to depositors.
C)borrowing from other banks.
D)selling negotiable CDs.

Question

Quizplus · Accepted Answer

Off-balance-sheet activities are those that do not appear on a company's balance sheet but have an impact on its financial performance. Trading activities are a common form of off-balance-sheet activity, as they involve buying and selling assets through financial instruments such as derivatives, which do not appear as assets or liabilities on the balance sheet.

B) and C) are incorrect because extending loans and borrowing from other banks both involve creating an asset or liability that would appear on the balance sheet. 
D) might be an off-balance sheet activity for some companies, but without additional information, we cannot determine if it is a correct choice.

Examples of Off-Balance-Sheet Activities Include