Why does a bank credit a customer's account when the customer makes a depositand debit the account when the customer makes a withdrawal?O Because banks use a different method of accountingO Because the customer's account is a liability for the bank.Because the customer's account is an asset to the bank

Accounting: Accounting is a system, or a process of collecting and organizing economic…

Answered: Why does a bank credit a customer's…

Why does a bank credit a customer's account when the customer makes a deposit and debit the account when the customer makes a withdrawal?

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Related questions

Q: are deducted from the balance per books in a bank reconciliation. O Notes collected by the bank O…

A: Bank reconciliation: It is the process of comparing company's bank statement to company's records…

Q: A fee the bank charges for maintaining bank records and processing bank statement items for the…

A: The question is asking to identify the term used for the fee that a bank charges for maintaining…

Q: Would charges for some other company's safe deposit box that were posted to your account be added to…

A: Bank reconciliation: Bank statement is prepared by the bank. The company maintains its own records…

Q: A bank statement ☐ is a bill from the bank for services rendered ☐ lets a depositor know the…

A: Bank statement:Bank statement refers to a printed record of the bank account balance. It consists of…

Q: when a company establishes a credit line with a bank, it is the same as borrowing from the bank True…

A: Credit line is similar to taking a loan but in credit line loan is taken on a regular basis. There…

Q: Reconciling Items per Bank - Outstanding Cheques For a bank reconciliation, how would one account…

A: Bank reconciliation is a statement prepared to reconcile the differences in balance in cash account…

Q: why is it important for companies to prepare bank reconciliation periodically?

A: Any businessman or a company contains a book called as Cash Book. This cash book contains the…

Q: In QuickBooks Online, what is the purpose of creating a deposit as income? Select an answer: to…

A: In QuickBooks Online, a deposit is typically used to record the receipt of funds into a business's…

Q: A bank may only take a bank deposit as collateral if the deposit was made at the same bank. a. True…

A: Collateral security refers to assets or property that a borrower pledges to a lender to secure a…

Q: From a bank's viewpoint, a customer's account in the bank is considered a: a.donation. b.liability.…

A: Bank statement: This is a periodic or monthly statement issued by bank reporting the account summary…

Q: Why should purchases to credit customers and cash receipts from credit customers be quickly…

A: sales can be either cash sales or credit sales. Credit sales will have accounts receivables or…

Q: What is Bank Overdraft? 1. A document used by a company's accounts payable department containing…

A: The objective of the question is to understand the concept of a bank overdraft in the context of…

Q: Under what conditions may a bank refuse to make payment?

A: Conditions:- - when the customer has died - customer had insane or insolvent. - customer lost the…

Q: The process of determining any differences between a bank statement balance and a checkbook balance…

A: The objective of the question is to identify the correct term for the process of determining any…

Q: A company repays its bank borrowings. The entry to record that transaction should be Group of…

A: Borrowing means where business taken loan from outsider to be used in business and repaid later.

Q: accounts receivable

A: Account receivable refers to the process of payment that the company should receive from the…

Q: Which bank control protects against forgery? Which bank control reports what the bank did with the…

A: The answer is as fallows

Q: In QuickBooks Online, what is the purpose of creating a deposit as income? Select an answer: to…

A: In QuickBooks Online, a deposit is typically used to record the receipt of funds into a business's…

Question

Why does a bank credit a customer's account when the customer makes a deposit
and debit the account when the customer makes a withdrawal?
O Because banks use a different method of accounting
O Because the customer's account is a liability for the bank.
Because the customer's account is an asset to the bank

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

This is a popular solution!

SEE SOLUTION Check out a sample Q&A here

Step 1

VIEW

Step 2

VIEW

Trending now

This is a popular solution!

Step by step

Solved in 2 steps

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.

Similar questions

How can you tell whether the amount on a check was altered after it was paid by a bank?
Why are cash receipts required to be deposited the same day they are received?
Introduction to business
Technically, a bank can require depositors to give prior notice before they withdraw funds from time deposits. True or False True False tv
can you cash a check from an equity reserve account
What is the adjusting entry of Bank Reconciliation : Credit Memo- Proceed Bank Loan
In a bank reconciliation, a bank service charge for printing checks is: A. added to the bank balance. B. added to the book balance. C. subtracted from the book balance. D. suthrachod from the bank balance.
Which one of the following is true of a signature card? A. It is the same as a deposit receipt and acts as a proof of the deposit transaction. B. It can be used as a debit card. C. It can only be used for bank accounts of individuals, not for the bank accounts of businesses. D. It shows each authorized person's signature for a bank account.
To deposit money in your business's bank account you should use O A cheque book A bank statement O A deposit slip O A withdrawal slip O O
Would a bank service charge be added to or subtracted from the company's books or the bank statement during the construction of a bank reconciliation?
After preparing a bank reconciliation, journal entries are necessary to record Bank service charges Deposits in transit Outstanding checks Both B and C are correct A, B, and C are correct
Advantages and disadvantages of accepting debit and credit card transactions as opposed to accepting personal Cheques from customers? (Consider both internal control and business reasons)