A company maintains the asset account, Cash in Bank, on its books, while the bank maintains a reciprocal account which is a contra-asset account. a liability account. also an asset account. a stockholders equity account. a. a liability accountb. an stockholder equity accoutc. also an asset accountd. a contra asset account

Question

Business

Zoe Gomez

10 November, 18:03

A company maintains the asset account, Cash in Bank, on its books, while the bank maintains a reciprocal account which is a contra-asset account. a liability account. also an asset account. a stockholders equity account. a. a liability accountb. an stockholder equity accoutc. also an asset accountd. a contra asset account

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Yadira Oconnell · Answer 1

A liability account

Explanation:

Companies save their money and assets in the bank, and they can take them out whenever they want. For a company, that money is debited in their asset account. Likewise, banks, on the other hand, maintain a reciprocal account which is the liability account. They maintain a liability account because sooner or later they have to pay back that money to the client/customer.