A company maintains the asset account, Cash in Bank, on its books, while the bank maintains a reciprocal account which is
A) a contra-asset account.
B) a liability account.
C) also an asset account.
D) an owner's equity account.

Question

Quizplus · Accepted Answer

The bank views the company's deposits as a liability because it owes this amount back to the company. The bank's obligation to return the funds deposited by the company makes it a liability on the bank's books.

A Company Maintains the Asset Account, Cash in Bank, on Its