Final answer:
Transactions requiring adjustments include those with prepaid expenses, accrued revenues, unearned revenues, and those regarding fixed assets. Money on a bank's balance sheet might not be present in the bank due to lending activities. The value of a loan in the secondary market can fluctuate based on the borrower's payment history and changes in economy-wide interest rates.
Step-by-step explanation:
The transactions that may require adjustments are: 1) Transactions involving prepaid expenses, 2) Transactions involving accrued revenues, 3) Transactions involving unearned revenues, and 4) Transactions involving fixed assets. Adjusting entries are often needed in accounting to ensure that revenues and expenses are recorded in the period they occur, which conforms to the accrual basis of accounting.
Regarding the question about bank balance sheets, the money listed under assets may not actually be in the bank because a bank engages in lending activities. Banks use the deposits they receive to make loans to others, which is a key aspect of how banks generate profits. Even though these loans are assets to the bank, the funds are not physically present as cash within the bank since they have been lent out to borrowers.
When buying loans in the secondary market, the price one might be willing to pay for a loan can be influenced by certain factors. a) If a borrower has been late on loan payments, the loan's value may decrease due to increased default risk. b) If the overall economy's interest rates have risen since the loan was made, a buyer might pay less as the loan's fixed rate may now be below the current market rate. c) If the borrower is a firm that has recently declared high profits, the loan is seen as more secure, potentially increasing its value. d) Finally, if economy-wide interest rates have fallen since the loan's inception, the loan may be worth more since its higher fixed rate is more attractive compared to new loans at current lower rates.